Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — PRICES AND CONSUMER PROTECTION

Prices Policy

Mr. Freud: asked the Secretary of State for Prices and Consumer Protection which Minister in his Department is responsible for handling consultations on the proposed new prices policy.

The Secretary of State for Prices and Consumer Protection (Mr. Roy Hattersley): I am primarily responsible. I have already had discussions with the CBI and the Retail Consortium and am meeting the Food and Drink Industry Council later this afternoon.

Mr. Freud: Will the Secretary of State accept that the reason why the prices policy is in tatters is that he applies different criteria to private industry and

the nationalised industries? What assurances can he give the House that, under the new prices policy, there will not now be a repetition of the squalid ignoring of the prices policy on gas prices by the Secretary of State for Energy?

Mr. Hattersley: I do not accept for a moment that the present prices policy is in tatters. As to the future prices policy, which was the subject of the hon. Gentleman's Question, it is clear in the consultative document that the provisions of that policy will apply to nationalised industries as they apply to the private sector.

Mrs. Sally Oppenheim: As the right hon. Gentleman has stated that workers who voluntarily take on austerity must be satisfied that the prices they pay are justified, in view of his right hon. Friend's decision to override the veto of the Price Commission on gas prices does he think that the increase in gas prices is what he would call socially accountable?

Mr. Hattersley: The increase in gas prices was part of a decision taken in December concerning the economy as a whole, which has clearly made the economy a good deal more stable than it was. Many of the decisions within that policy were regrettable although necessary. I think that the gas price increase comes into that category.

Mr. Heffer: Would not my right hon. Friend agree that an increase in prices of this kind will affect working people in particular very badly? Will not the


Cabinet reconsider this matter? This is something which working people obviously are not prepared to accept much longer, which means that it will have a very bad effect on phase 3 of the incomes policy.

Mr. Hattersley: I note what my hon. Friend says. Specific questions about specific details of the gas price proposal, to which I think he was referring, are not for me but for the Secretary of State for Energy. [HON. MEMBERS: "Oh! "] However, I also understand the point that my hon. Friend makes about the Cabinet in general having to investigate and inquire into these matters, and I am sure that my colleagues will note what he has said.

Industrial Clothing

Mr. Hardy: asked the Secretary of State for Prices and Consumer Protection if he has received representations concerning increases in the price charged for the cleaning or rental of industrial clothing during the last two years; and how many such cases he has referred to the Price Commission.

The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): I have received the representations of my hon. Friend on this subject and I referred them to the Chairman of the Price Commission.

Mr. Hardy: Does my hon. Friend agree that pricing policy in this area should receive special and sensitive consideration? Is he aware that the Price Commission is suspected of too easily rubber-stamping substantial price increases, including the case to which I have drawn his attention, in which two price increases were allowed in one year, bringing the charge for one garment from 28p to 38p? Does he not think that that is excessive?

Mr. Maclennan: The Price Commission is empowered to investigate such increases and only to permit those which can be justified by allowable cost increases. I have no means of knowing, but I must assume, that the Commission satisfied itself that the allowable cost increases made a rise of this order inevitable.

Nationalised Industries

Mr. Giles Shaw: asked the Secretary of State for Prices and Consumer Protection what steps he will take to encourage the reductions of costs by better use of resources in the nationalised industries; and how he will ensure consumers share the benefits.

Mr. Hattersley: My proposals for prices policy after 31st July will apply to nationalised industry prices in broadly the same way as they would to other sectors. The new criteria will focus attention on cost reductions and better use of resources.

Mr. Shaw: Will the Secretary of State please give some encouragement to the consumer in regard to the nationalised industries? How can the consumer believe that she will get a better share of the benefits of nationalised industries when, as in the case of gas, she is being forced to pay a price which is clearly not allowed by the Price Commission? Will the right hon. Gentleman recognise that that decision runs quite counter to what is allowed in the private sector?

Mr. Hattersley: No, I do not accept the hon. Member's judgment about that at all. As for comforts to the consumers, the position is very clear. We have now largely corrected the errors made in nationalised industry prices by the previous Government, and we can look forward in future to increases in nationalised industries' prices, which cannot altogether be avoided, being at a much slower rate than in the recent past.

Mr. Adley: Why are there three Ministers, one Whip, one Parliamentary Private Secretary and only six Labour Back Benchers in the Chamber for Questions on prices and consumer protection? Have the right hon. Gentlemen's Back Benchers despaired of ever having their Questions answered?

Mr. Neubert: Is it not clear that the impending increase in the price of gas is no more and no less than a tax on the consumer? If the costs of production are less, why should the consumer have to pay because the Government have failed to reduce their extravagant spending programmes?

Mr. Hattersley: The hon. Gentleman cannot have it both ways. He is implying that the gas price increase is intended to help deal with some of the economic problems, such as the reduction of the public sector borrowing requirement, that we successfully faced in December, when his party proposed more savage cuts. If we followed any of the suggestions that the hon. Gentleman and his colleagues have made, that would affect the consumer a great deal more.

Price Controls (Categorisation Limits)

Mr. Hodgson: asked the Secretary of State for Prices and Consumer Protection whether the present categorisation of firms in the Price Code will remain the same under the new prices policy.

Mr. Maclennan: The present intention is that the categorisation limits in the present price controls should not be substantially changed when the new policy comes into operation. This question will, however, fall within the consultations on the new policy proposals.

Mr. Hodgson: In view of the continuing high level of inflation, does not the Minister agree that the qualifying level for category 1 firms should be raised a great deal, thus lifting a small part of the increasingly heavy burden that the Government have placed on small businesses and small business men?

Mr. Maclennan: The category limits were last raised in August to take account of inflation. Too frequent changes would be unjustifiable.

Inflation

Mr. Grist: asked the Secretary of State for Prices and Consumer Protection what is the latest figure for the rate of inflation over the last three months expressed at an annual rate.

Mr. Rost: asked the Secretary of State for Prices and Consumer Protection what is the latest monthly increase in the retail price index, calculated on a year on-year basis; and by how much the index has increased since February 1974.

Mr. Tim Renton: asked the Secretary of State for Prices and Consumer Protection what is the latest three-monthly rate of price inflation.

Mr. Hattersley: Over the three and 12 months to January 1977, the retail price index increased by 5·4 per cent. and 16·6 per cent. respectively. This brings the increase since February 1974 to 69·5 per cent. For what it is worth, the three-month annualised figure is 21·8 per cent.

Mr. Grist: Does not the right hon. Gentleman feel a sense of shame at that last figure as it has risen so much from the vaunted 8·4 per cent. of the Chancellor of the Exchequer at the last General Election?

Mr. Hattersley: I do not feel very much about that last figure, except what I tried to imply in my answer, that it does not have much statistical validity.

Mr. Rost: As the Government's new anti-inflation policy appears to be to overrule their own independent Price Commission, would it not be better to scrap it?

Mr. Hattersley: In overruling the Price Commission, the Government would apply a provision in the Act for which the hon. Gentleman voted. He must make up his mind whether he was wrong in voting for that overruling provision. I think that it was right and necessary, and it can occasionally be applied properly.

Mr. Skinner: Does my right hon. Friend understand fully that the £6 pay policy and its successor have not resulted in the dramatic fall in price increases and inflation that he and his fellow Ministers in the Cabinet supposed? What with unemployment almost doubling in that period, prices rising, the social wage being cut and there being no further investment, is there any reason to carry on with another round of pay policy?

Mr. Hattersley: I think that there is every reason to carry on. [Interruption.] Unlike some Conservative Members, my hon. Friend has asked a question believing, as I do, that it is a serious issue. My hon. Friend knows very well that the increase in the retail price index over the past six months has been largely the result of sterling depreciation. I have no doubt that, if we did not reach agreement on another wages round, sterling would again be in jeopardy and inflation would be a great deal worse.

Mr. Giles Shaw: The right hon. Gentleman cannot have it all ways. Does he not agree that inflation figures of 69·5 per cent. are a tremendous condemnation of what the Government have done in the past three years? Will he use this opportunity of expressing his abhorrence of total price freezes, which can do nothing more nor less than to increase unemployment from its present hideous level?

Mr. Hattersley: I have already made it clear that in my view a total price freeze would be injurious to our industrial prospects and bad for the economy in general and working people in particular. As for the overall rate of inflation. I have no doubt that, if we remain resolutely committed to the policies we announced in December, the rate of inflation will begin to reduce in the summer and thereafter. I am sure that that is a right thing for us to do.

Mr. Heffer: Does my right hon. Friend agree that the high rate of inflation has been partly due to the common agricultural policy and to the fact that we are members of the Common Market, where food prices are much higher than anywhere else in the world? Is it not about time the Government renegotiated the CAP and stopped talking about renegotiation?

Mr. Skinner: It is time we got out altogether.

Mr. Hattersley: I think that my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) will agree that the position being taken by my right hon. Friend the Minister of Agriculture, Fisheries and Food in the negotiations in Brussels, which are concerned with prices next year, reflects our intention of being very tough during the discussions and having no price increases which would be injurious to our general economic policy. But I am sure that he also accepts that what has really affected inflation in this country over the past year is the sterling rate of exchange. I do not care to contemplate how sterling would have deteriorated in October and November of last year had we not been members of the Commons Market.

Mr. Tebbit: Does the right hon. Gentleman think that an inflation rate of 16·6

per cent., if he wants the year-on-year figure, or nearly 20 per cent., if he wants the three-month figure, marks a successful Government policy?

Mr. Hattersley: I believe that it marks a policy which will improve with the summer. [HON. MEMBERS: "Which Summer?"] The Opposition must decide whether they want to support us in policies that will result in a gradual but continual improvement in the inflation figure. The effects of the December measures will soon work themselves through and there will soon be another wages round. When that is debated, the Opposition will have to decide which side they are on.

Mr. Adley: asked the Secretary of State for Prices and Consumer Protection if there has been a rise or fall in the rate of inflation in the United Kingdom in the last six months; and how this compares with the trend in the other EEC countries.

Mr. Hattersley: Over the six months to January 1977, the year-on-year rate of inflation in the United Kingdom has increased from 12·9 per cent. to 16·6 per cent. Exactly comparable information for other member States is not available, but to December the average rate of inflation for these countries was similarly on an upward trend.

Mr. Adley: Is the right hon. Gentleman aware that, according to statistics from his own Department, inflation has risen every month in Britain for the past six months, a very different pattern from that in Belgium, Denmark, France, West Germany, Luxembourg and the Netherlands, to name but six? Apart from the fact that we are unfortunate in having an ineffective Government, what is so special about Britain compared with the other countries of Western Europe?

Mr. Hattersley: I am simply relying on the information that the Treasury gave the hon. Gentleman on 3rd March. One of the things that is special about us is that on the December figures our rate of acceleration is a good deal less than that of many of our partners.

Mr. Skinner: Will my right hon. Friend confirm that what the other Common Market countries did when they participated in the recent IMF loan was to lend us the money in order for us to continue to buy their goods?

Mr. Hattersley: I think my hon. Friend will agree that that is somewhat of an over-simplification of what the loan provided. It also provided us with the wherewithal to go on selling our goods to Europe and to keep the British economy afloat. Without the IMF loan, the country would have been in a very difficult situation.

Mrs. Sally Oppenheim: Does the right hon. Gentleman recall that in a speech at Blackpool last April the Prime Minister boasted that on the previous six months' figures the rate of inflation had halved? Is the Secretary of State aware that if one takes precisely the same yardstick as the Prime Minister took then the rate of inflation has not halved or doubled but has trebled? Will the right hon. Gentleman say how long he expects that this country can go on with rates of inflation which are double and treble those of our main competitors?

Mr. Hattersley: That extraordinarily selective use of figures does not excite me half as much as it clearly excites the hon. Lady. The figure is the year-on-year rate. The increase in the year-on-year rate has decelerated, and the hon. Lady will find that if she asks me or someone else that sort of question towards the end of the year the position will be appreciably improved.

Mr. Molloy: Is my right hon. Friend aware that the real thing that could damage this country would be if the prices of food, clothing and footwear which obtain in Common Market countries were applied here? We would be in a very serious situation indeed. That is why so many people from the other eight Community countries are prepared to come over here at the weekends in order to stock up and go back home because, despite our so-called inflation, the price of the goods that I have mentioned is much cheaper in the United Kingdom than in the EEC countries.

Mr. Hattersley: Of course they are, and many of them are so kept by the green pound, which is something that we have to maintain and preserve. My hon. Friend well knows that all those people who come here are earning EEC wages and paying United Kingdom prices. I hope that we can get to the day when we,

too, will be earning EEC wages in this country.

Mr. Marten: May 1, unusually, come to the help of the right hon. Gentleman in his answer to the question of my hon. Friend the Member for Christchurch and Lymington (Mr. Adley)? Is not one of the reasons why our inflation has gone up more than that of our Common Market partners, certainly the old Six, that the CAP and the transitional stages have forced up the price of food?

Mr. Hattersley: That is certainly a factor, but statistically it is a small factor indeed compared with the major reason, which is the depreciation of sterling.

Price Commission Reports (Sales)

Mr. Dykes: asked the Secretary of State for Prices and Consumer Protection how many copies of the Price Commission's quarterly reports for the periods 1st June to 31st August 1976, and 1st September to 30th November 1976, were sold to the general public.

Mr. Maclennan: Separate figures for sales to the general public are not available. The latest figures available show total bookshop sales as 1,192 and 1,078 respectively.

Mr. Dykes: Are not those sales rather meagre? Incidentally, the report now costs £1·65 compared with the original £1. Was the Minister surprised that the Commission said that new code changes had made it impossible to draw up comparative profit figures, so that it was no longer making judgments about the future movement of profit margins? Is not that an astonishing assertion from a Commission that is supposed to bear in mind all factors when drawing up its price control policy?

Mr. Maclennan: The Price Commission's general conclusions, reported in its quarterly reports, are given widespread currency by the Press and other media following publication of the reports. The increased price of the second report reflects increased costs of production, which I understand have been considered most carefully by the Commission.

Fuel Prices

Mr. Hooley: asked the Secretary of State for Prices and Consumer Protection whether his new proposals for


monitoring and control of prices will be applicable to fuel; and, if so, how they will operate.

Mr. Maclennan: My right hon. Friend's proposals for prices policy after 31st July would apply to fuel prices in broadly the same way as they would to other products, with such modifications as are necessary to reflect our Community obligations in respect of coal prices and the Government's special responsibilities for the nationalised industries.

Mr. Hooley: I am not quite sure how to interpret that somewhat obscure and ambiguous answer. Is my hon. Friend aware that if, under the new system, we have a repetition of what we have at present in respect of gas prices, the whole system of price control, such as it is, will be brought into total disrepute?

Mr. Maclennan: One of the principal aspects of the new prices policy, which is an improvement and a more effective method of price control, is that it will enable us to launch investigations to cover pricing practices and levels in all industries, including the nationalised industries. They will simply be judged against the provisions under the Price Code which enable the Commission to look behind the Price Code to the whole circumstances of the industry. I think that this will enable a more realistic check to be taken.

Mr. Michael Latham: Is not the simple truth behind that bureaucratic answer the fact that the Government will monitor and control such energy prices as it is politically convenient to do so?

Mr. Maclennan: If political convenience were the sole consideration, perhaps the hon. Gentleman would concede that it might not have been the Government's desire to increase the price of gas. But the economic justifications for having done so have already been spelt out by my right hon. Friend.

Mr. Rooker: Cutting through some of the waffle in the answer that we have just heard, may I ask my hon. Friend to state categorically that the new prices policy will not be subvented to the Treasury in the same way as with the present prices policy in regard to fuel?

Mr. Maclennan: The Treasury is responsible—

Mr. Rooker: Yes or no?

Mr. Maclennan: —within the Government for the overall view of the management of the economy. My right hon. Friend the Secretary of State for Prices and Consumer Protection will, within the collective governmental framework, ensure that the consumers' interests are taken fully into account when arriving at a collective position. My hon. Friend and Conservative Members who complain of bureaucratic answers ought to accept and understand that the principal interest of the consumer at this time is in obtaining a stabilised rate of sterling, because it is the decline in the parity of sterling which is directly responsible for the price increases which are being complained of today. My hon. Friend will acknowledge that the measures taken in December have strongly contributed towards establishing the stability of sterling. The package must be judged as a whole by that test.

Mr. Kenneth Lewis: Is the Minister aware that it really does not make sense for the Government to increase fuel charges across the board while at the same time subsidising a lot of people because they have put up prices too much at the same time as the nationalised fuel industries are not only making a profit but also profiteering at the general expense of the consumer?

Mr. Maclennan: I assure the hon. Gentleman that this Government have no intention of returning to the policies of the Conservative Opposition in subsidising the nationalised industries at tax-payers' expense and thus distorting their financial control.

Food Prices

Mr. Rathbone: asked the Secretary of State for Prices and Consumer Protection how long he expects the present rising trend in food prices to continue.

Mr. Banks: asked the Secretary of State for Prices and Consumer Protection what he expects the rise in food prices will have been from July 1976 to July 1977.

Mr. Hattersley: The food index rose by 81·5 per cent. between February 1974 and January 1977. I am not prepared to forecast the rate of increase for the year


to July 1977 or to guess how present trends may change.

Mr. Rathbone: Those statistics are worrying enough, as are the statistics which the Secretary of State gave me recently in reply to another Question. Can he reassure the country in any small way at all that the rate of increase of previous months and years will be decreasing during the coming year? Does he not appreciate that it is confidence in the present Government which is at the root of the price of sterling, and that the price of sterling is at the root of the price of food?

Mr. Hattersley: Certainly the price of sterling is the main determinant in the price of food. Of course, the price and the value of sterling have appreciated considerably between December and now. The hon. Gentleman must himself interpret whether that is the result of improved reputations abroad of the present Government. The comfort I offer the consumer is that, if we can hold sterling at or about the present level, the adverse effects of October, November and December of last year will not reappear and food price changes will not be as bad as they were during that period.

Mr. Gwilym Roberts: Does my right hon. Friend agree that food prices within the Common Market are on average considerably higher than world prices? Does he not find it remarkable, in view of the rather hypothetical concern expressed by the Opposition about prices, that the only idea of policy that the Leader of the Opposition has made herself clear about is opposition to any idea of a price freeze?

Mr. Hattersley: That is very true. My hon. Friend will have noticed, as the whole country has noticed, that while the Opposition have a great deal of criticism to offer about prices and prices policy they have nothing constructive to say about what they would do in its place. The Leader of the Opposition has said nothing positive during the six months that I have been in this job. If she has said it, it has been my misfortune to miss it. I hope that in the coming months we shall have a debate about prices and prices policy, if only to discover whether the Opposition have any policy at all.

Mr. Banks: Is the right hon. Gentleman aware that many people will hardly believe that the figure which he has given of 81·4 per cent. is the true figure for the rise in prices? Is not that an appalling indictment of what the Government have done and what the British housewife has had to suffer? When will prices stop rising?

Mr. Skinner: When we get out of the Common Market.

Mr. Hattersley: The answer to the hon. Gentleman's question of when food prices will stop rising covers a spectrum of facts from when there ceases to be a shortage of coffee as a result of frost in Africa to when there ceases to be drought in England and when the pound continues on its stabilised path. My view is that all these things are a great deal more complicated than any Opposition Member ever pretends he understands or is prepared to make out.

Mr. MacFarquhar: In view of the stress which my right hon. Friend has rightly put on the fall in the value of sterling accounting for price increases, may I ask whether he is satisfied that the public are aware of the impact of the sterling crisis upon prices? When there are major price increases in areas which directly affect the public most, will my right hon. Friend issue information explaining the extent to which that is the result of a fall in the value of sterling?

Mr. Hattersley: I shall try to do that, but it is sufficiently difficult to educate the Opposition on these matters and I think that educating a wider public, albeit a less biased one, might be very much more difficult.

Mr. Freud: If the purpose of consumer advice centres is realistically rather than, cosmetically to help to bring down prices, will the right hon. Gentleman consider extending these to rural areas, or possibly having mobile advice centres, so that people living outside cities may have the benefit of them?

Mr. Hattersley: I am not sure that the object of these centres is to bring down prices. Rather is it to provide information which is necessary and appropriate. The hon. Gentleman is right. One of the things that I have tried to do over the past year is to extend mobile centres that can go


for a time each month to rural areas. The more we can do that, the better. We have extended the grant for a year, and I hope that local authorities which feel that they want to abandon the centres will think again, because I agree that they perform a valuable service.

Mr. Giles Shaw: Would the right hon. Gentleman care to comment, if not on food in general, on bread, which once again, according to The Times, has raised its head? Will the right hon. Gentleman comment on the resolution of the Price Commission that only a portion of the price discount is an allowable cost? Will he comment on whether that is a change from previous practice? Is it not a fact that manufacturers may recover cost of production globally and not just line by line, as appears to be the case for bakers?

Mr. Hattersley: As I understand it, the Price Commission made clear to the bakers its position on recoverable costs. I discovered that the Price Commission made the position clear before the bakers adjusted prices after Christmas. That seems to be a decision for the Price Commission, and for it alone.

Household Prices

Mr. Michael McNair-Wilson: asked the Secretary of State for Prices and Consumer Protection what further measures he plans to take to keep down household prices.

Mr. Maclennan: My right hon. Friend has published proposals for a more effective prices policy to succeed the present control powers when they expire on 31st July.

Mr. McNair-Wilson: As the Government have not had much success in keeping down prices, can the hon. Gentleman say whether it is his intention to allow the Post Office to go ahead with its proposal to increase the letter and parcels rates? Can he say how much traffic the Post Office expects to lose by increasing these charges?

Mr. Maclennan: The Price Commission has vetted these proposals, and I understand that they are not out of line with the Price Code. Therefore, there is no case for the Secretary of State to intervene.

Mr. John Ellis: With regard to the household price of food, may I ask my hon. Friend whether he has seen the figures produced by the National Consumer Council, in association with the Consumers' Association, which reveal that, leaving aside inflation, the Commission's proposals for this year—the last stage of the transition—will increase farm prices by 3 per cent. and that other measures that it is taking will lift the food bill for a family in this country by £600 million a year—that is, by 4 per cent. per household, or 70p on the average household? Ought we not to get out of the CAP, because those are the increases that we shall face, leaving aside inflation?

Mr. Maclennan: My right hon. Friend the Minister of Agriculture, Fisheries and Food is this afternoon engaged in negotiations on the Commission's proposals to which my hon. Friend has referred, and I shall be joining him there later. I think my right hon. Friend will understand that the proposals are still very much a matter for negotiation, and my right hon. Friend has made it clear that he believes that price increases for commodities which are in structural surplus are unacceptable to this Government.

Mr. Dykes: Will the hon. Gentleman, on this one, deliberately eschew longwinded, bureaucratic and incomprehensible answers and say whether the new controls after July will be mild or severe?

Mr. Maclennan: If the hon. Gentleman fails to understand my answers, I am afraid that I am not wholly to blame.

Accidents in the Home

Mr. Gwilym Roberts: asked the Secretary of State for Prices and Consumer Protection what are the latest figures available for the number of accidents in the home; and if he will break these down according to age and type of accident.

The Minister of State, Department of Prices and Consumer Protection (Mr. John Fraser): Statistics provided by the Office of Population Censuses and Surveys show that, in 1975, 5,081 persons died as a result of accidents in the home in England and Wales and 1,094 in residential institutions. I will, with permission, circulate details in the Official Report.
Fuller statistical information about home accidents will be provided in future by the Accident Surveillance System recently set up by my Department.

Mr. Roberts: Does my hon. Friend agree that home safety councils are operating on a shoestring, and that in view of the number of accidents there is an urgent need to provide greater resources here? Will he study the recent issue by the German Government of stamps dealing with home safety interests? Will he look at this proposal with a view to discussing with the Post Office the possbility of something similar in this country?

Mr. Fraser: I shall look at that proposal, of which I have not heard before. We have recently increased the grant to RoSPA, and publicity on home safety is promoted by my Department, by local authorities and by many other bodies.

Mr. Rathbone: Can the hon. Gentleman give statistics of how many accidents have been caused by the linkage of cookery machinery, ovens and fires to North Sea gas? What steps is he taking to minimise these?

Mr. Fraser: I am sorry, but I cannot give those figures because the accident figures so far have been analysed by injury and not by cause of accident. The new Accident Surveillance System will give not only the injury but the causes, and we hope to get meaningful information from the statistics towards the middle of this year.

Mr. Freud: Will the hon. Gentleman accept that his Department is already broken down by age and accident?

Following is the information:

ACCIDENTS IN THE HOME AND RESIDENTIAL INSTITUTIONS, DEATH BY CAUSE AND AGE GROUP—ENGLAND AND WALES 1975








All Ages
0–14
15–64
65 and over








Home
Residential Institution
Home
Residential Institution
Home
Residential Institution
Home
Residential Institution


Accidental poisoning by drugs and medicaments
…
…
…
484
13
14
2
371
10
99
1


Accidental poisoning by other solid and liquid substances
…
…
68
3
3
—
57
3
8
—


Accidental poisoning by gases and vapours
…
…
…
…
123
—
11
—
62
—
50
—


Falls
…
…
…
…
…
2,530
860
43
—
340
51
2,147
809


Burns
…
…
…
…
…
593
49
103
—
164
7
326
42


Scalds and accidents caused by corrosive liquids
…
…
…
32
3
10
—
2
—
20
3


Electrocutions
…
…
…
…
54
—
8
—
38
—
8
—


Inhalation and ingestion of food
…
205
99
72
1
92
47
41
51


Injury undetermined whether accidentally or purposely inflicted
…
536
26
11
1
400
13
125
12


Other accidents
…
…
…
456
41
153
1
135
25
636
25


Total
…
…
…
…
5,081
1,094
438
5
1,663
156
2,980
933

Consumer Credit Act

Mr. McCrindle: asked the Secretary of State for Prices and Consumer Protection if he is satisfied with the operation of the Consumer Credit Act.

Mr. John Fraser: I believe that, when fully effective, the Consumer Credit Act will provide the protection for the consumer in matters relating to credit and hire which was intended.

Mr. McCrindle: How soon will the Minister be introducing regulations requiring a full statement, when so-called 100 per cent. mortgages are being advertised, of the true rates of interest comprising such mortgage facilities? Is the hon. Gentleman aware that this is a source of great concern to young couples in particular?

Mr. Fraser: I understand that, and I have recently made regulations to determine the effective rate of charge for credit. I expect the advertisement disclosure regulations to take effect towards the end of the year.

Distributors (Investment)

Mr. David Price: asked the Secretary of State for Prices and Consumer Protection in what way he intends to encourage investment among distributors.

Mr. Maclennan: The investment relief provisions of the present code already meet this need.

Mr. Price: Is the hon. Gentleman aware that that is not entirely satisfactory? Will he take account of the fact that there are two aspects to this? There is investment, which improves shopping facilities both for customers and for the staff working in retail outlets, and, far more seriously, there is the problem of providing sufficient working capital to accommodate continual price rises in the costs of materials and food being bought by retailers. That has to be financed. The Price Code must accommodate it.

Mr. Maclennan: The Government recognise the force of some of the hon. Gentleman's comments. After changes were made to the Price Code in August, as a result of relief claimed under the investment relief provisions £355 million of investment expenditure was claimed.

I think that the hon. Gentleman's point Consumer Credit Act has been met.

Mrs. Sally Oppenheim: Is the hon. Gentleman aware that in the new prices policy consultative document it is clear that the distributors have been discriminated against in a big way? There is no relief for them of the same order as is given to manufacturing industries. As distributors have not been making excessive profits, and as they employ a high proportion of school leavers, is the hon. Gentleman satisfied with the amount of unemployment among school leavers that is likely to be created?

Mr. Maclennan: I am satisfied that the proposals for the distributive trades in the consultative document will not impose a discriminatory or unfair burden on that section. I am equally sure that it is necessary to retain control of gross and net profit margins in the distributive trades at a time when working people throughout the country are accepting universally the need for restraint in their incomes.

Mr. Skinner: Does my hon. Friend agree that in the past 40 minutes we have been listening to a tirade from the Opposition about rising prices? Does he further agree that if the proposal of the hon. Member for Gloucester (Mrs. Oppenheim) is carried into effect it will push up prices even further?

Mr. Maclennan: I agree completely—

Mr. Skinner: Say "Yes".

Mr. Maclennan: Yes, and yes again. My hon. Friend has underlined the point made by my right hon. Friend that the Opposition's performance this afternoon has been wholly negative.

Price Increases

Mr. Atkinson: asked the Secretary of State for Prices and Consumer Protection if he will introduce a statutory price ceiling beyond which additional price increases will have to be separately agreed with the Price Commission.

Mr. Maclennan: Any uniform price ceiling might allow some companies higher price increases than would be justifiable under the investigatory system we have proposed, whilst it could prevent


many other companies from fully recovering cost increases and from raising the funds needed to support investment and safeguard jobs.

Mr. Atkinson: Does my hon. Friend accept that that reply will be considered by the TUC to be totally evasive because, although some companies might benefit in the way suggested by him, they would be a very small minority? Is he aware that there is an overwhelming feeling within the TUC that there should be a return to free wage bargaining and that the only way in which that can be accomplished in an orderly fashion for phase 3 of wage policy is by having a fixed ceiling above which prices could rise only if the circumstances were considered by the Price Commission to be exceptional? Therefore, it would be possible to have a system of free wage bargaining against price ceilings which would bring about the distributive element in phase 3 for which we are looking.

Mr. Maclennan: My right hon. Friend the Secretary of State is looking forward to hearing the TUC's detailed response to his proposals. However, it has been made clear, and has been widely accepted, that the principal disadvantage of the Price Code as it stands is that it is not sufficiently selective, and it can enable companies which may comply with the provisions of the code to get away with exploiting consumers. The new policy will be much more effective in dealing with that situation.

Mr. Rost: Will the hon. Gentleman explain to a confused public why he does not propose to intervene to overrule the Price Commission in respect of the proposed increases in postal charges but has overruled it in respect of the proposed increase in gas prices?

Mr. Maclennan: I did not intervene to overrule the proposals in respect of gas prices, nor shall I in respect of the Post Office proposals.

Prices Policy

Mr. Canavan: asked the Secretary of State for Prices and Consumer Protection how many representations he has received about the consultative document on prices policy.

Mr. Ridley: asked the Secretary of State for Prices and Consumer Protection what consultations have taken place in relation to the new Price Code announced recently.

Mr. Silvester: asked the Secretary of State for Prices and Consumer Protection what consultations he has held on proposed legislation involved in enacting the new prices policy.

Mr. Hattersley: I have already held discussions with the CBI and the Retail Consortium and shall be meeting the Food and Drink Industries Council this afternoon. My Department has received representations from a large number of interested bodies. Discussions and correspondence on my proposals are continuing, and the outcome will be assessed at the end of the consultative period on 18th March.

Mr. Canavan: In view of the justifiable demand of the trade union movement for tougher price controls, instead of just tinkering with net profit margins, why not try at least a temporary freeze on the retail prices of certain basic essentials, such as foodstuffs, fuel, rents and mortgage rates? Why on earth is coal specifically excluded from the mediocre proposals in the consultation document?

Mr. Hattersley: I believe that a general price freeze would be wrong because it would not be in the interests of the economy and any prospect for expansion would be inhibited. My hon. Friend should not talk about a general price freeze as if it were TUC policy. It is not. The TUC's economic statement called for the ability to hold down prices by freeze on selected occasions, and that is one of the proposals which appears in my consultative document.

Mr. Silvester: How does the Minister intend to prevent the new investigatory powers which he proposes in his consultative document from having an arbitrary effect on the firms which he proposes to investigate?

Mr. Hattersley: First, if the legislation is passed there will be some general criteria which the Price Commission must observe; secondly, by the character and quality of the Price Commission; thirdly, by the necessity for the Secretary of State of the time to approve


what the Commission does; and, fourthly, by applying a parliamentary check to the Secretary of State.

Mr. William Hamilton: Is my right hon. Friend looking long and hard specifically at the blatant gambling which is going on in the tea market and making sure that the consumer is not being rooked in the same way as he is on coffee?

Mr. Hattersley: I shall examine the possibility of the Price Commission considering the tea situation. But I am sure my hon. Friend knows very well that the main cause of the increase in the price of tea—as may turn out to be the case with coffee—is the increase in import prices, and that is something we cannot avoid.

Mr. Channon: Does the Secretary of State appreciate that he may well get the worst of both worlds with his proposed new Price Code? It will have no significant effect on prices, but it will make industries think that it will be used in a purely arbitrary way and, therefore, will frighten off investment in them.

Mr. Hattersley: I do not believe that it will frighten off investment. With the right sort of Price Commission, which is something I want to create, industry will have confidence in the common sense and objectivity of the Commission.
On the other point, there is no possible statutory prices policy other than a general price freeze which can hold down all prices to a significant extent. As I do not believe that a general price freeze would be right, I do not even contemplate a prices policy which follows the rules that the hon. Gentleman has suggested. It is the general economic policy which must lower the inflation rate.

Mr. Madden: Does my right hon. Friend agree that many consumers believe that successive prices policies have generated more paper than benefits to them? Can he give those consumers a rough indication of the total benefits to them of successive pricing policies? Further, what steps is he taking to try to overcome speculation, in particular in the commodities market, which is in many respects undermining any hope there may be of getting popular support for prices policies?

Mr. Hattersley: The quarterly report of the Price Commission lists proposed price increases which the Commission prevented from going ahead. This, according to my hon. Friend's standards and mine, comes under the heading of benefits to the consumer which we could publicise. However, I emphasise that nobody should pretend or believe that a prices policy can reduce prices in the way that general economic strategy can do so. It must be the general economic policies which bring down inflation to tolerable levels.

Price Control Proposals

Mr. Mike Thomas: asked the Secretary of State for Prices and Consumer Protection if he will list in the Official Report those organisations which he has directly invited to comment on his new price control proposals.

Mr. Hattersley: I have written directly to the TUC, CBI, Retail Consortium, Food and Drink Industries Council, National Consumer Council and Price Commission seeking their views on my proposals. My Department has also written to over 250 representative organisations and individuals. With permission, I will circulate details of these in the Official Report. In addition, some 4,000 copies of the consultative document have been issued in response to inquiries.

Mr. Thomas: Is my right hon. Friend aware that a number of hon. Members have been concerned that the representations made by consumer organisations as opposed to those made by producer organisations have not been weighed carefully enough in his Department? What steps is he taking to make sure that the views of, for example, the National Consumer Council are taken properly into account?

Mr. Hattersley: I shall be consulting the National Consumer Council tomorrow when its representatives come to see me. Their offerings and comments will be treated in exactly the same way as those made at meetings with the CBI and the Retail Consortium last week. The proper importance of the council will be accepted in the discussions and its views will be taken into account.

Mr. Marten: According to the Minister of Agriculture, the price of butter will increase this year to 72p to 75p a pound.


Will not that offend against the prices policy? Can the right hon. Gentleman say whether British domestic policy or Community policy takes precedence?

Mr. Hattersley: I really cannot go on answering questions that are not for me. The hon. Member must put down that question to the Minister of Agriculture.

Following are the details:—

LIST OF THOSE CONSULTED ON FUTURE PRICES POLICY

CONSULTATIVE DOCUMENT 22.2.77

By the Secretary of State

CBI
TUC
Retail Consortium
Price Commission
National Consumer Council
Food &amp; Drink Industries Council

At Official Level

British Hotel Restaurant and Caterers Association
Motor Agents Association
National Association of Holiday Centres
Kinematograph Renters Society
Independent Film Distributors
Scottish Newspaper Proprietors
Retail Food Confederation
Consultative Committee of Accountancy Bodies
Cinematograph Exhibitors Association
Association of Independent Cinemas
Periodical Publishers Association Ltd
Association of British Launderers and Cleaners Ltd
Consumer Campaign Committee
Association of British Chambers of Commerce
British Importers Confederation
National Federation of Consumer Groups
Federation of Wholesale and Industrial Distributors
Food Manufacturers Federation
Equipment Leasing Association
Federation of Manufacturers of Construction Equipment
Electronic Engineering Association
Ford Motor Company
British Independent Steel Producers Association
National Federation of Builders and Plumbers Merchants
The Brewers Society
The Publishers Association
Cement Makers Federation
Council of Iron Foundry Association
Society of Motor Manufacturers and Traders
British Paper and Board Industry Federation ICI
Chemical Industries Association
The General Electric Co Ltd
Issuing Houses Association
Engineering Industries Council
Road Haulage Association
Multiple Food &amp; Drink Retailers Association
The Hundred Group
Triplex Foundries Group Ltd
Guest Keen &amp; Nettlefolds Ltd

British Aluminium Co Ltd
Bowater Scott Corporation Ltd
Kimberley Clark Ltd
National Consumer Protection Council
Women's National Commission
Association of Certified Accountants.
British Chemical Engineering Contractors.
The Scotch Whisky Association.
Law Society of Scotland.
Alcan Aluminium (UK) Ltd.
British Federation of Hotel, and Guest Houses Association.
Institute of Cost and Management Accountants.
Institute of Chartered Accountants in Scotland.
British Bankers Association.
British Plastics Federation.
British Electrical and Allied Manufacturers Association.
British Mechanical Engineering Confederation.
Courtaulds Ltd.
British Textile Employers Association.
The National Chamber of Trade.
Process Plant Association.
National Federation of Engineers and Tool Manufacturers.
Finance Houses Association.
Incorporated Association of Preparatory Schools.
National Association of Steel Stockholders.
Royal Institute of British Architects.
Royal Town Planning Institute.
Royal College of Veterinary Surgeons.
Bar Council.
Association of District Councils.
Scottish Courts Administration.
The Royal Institution of Chartered Surveyors.
The Senate of the Inns of Court and the Bar.
Faculty of Advocates.
Wholesale Grocers Association of Scotland.
Albright and Wilson Ltd.
The Timber Trade Federation.
Multiple Tobacconists, Confectioners and Newsagents Group.
Imperial Group Limited.
Wholesale Tobacco Trade Association.
Wine and Spirit Association of Great Britain.
Retail Confectioners Association Ltd.
Co-operative Union Ltd.
The Gin Rectifiers and Distillers Association.
Scottish Grocers Federation.
National Association of British Wine Producers.
The Vodka Trade Association.
Belfast and Ulster Licensed Vintners Association.
The Federation of Retail Tobacconists.
National Association of Cider Makers.
National Federation of Retail Newsagents.
The Wholesale Wine and Spirit Association of Scotland.
Independent Wine Merchants Association Ltd.
Scottish Licensed Trade Association.
Scottish Tobacco Trade Federation.
The Law Society.
British Veterinary Association.
Institute of Chartered Accountants in Ireland.
Royal Incorporation of Architects in Scotland.
The Association of Consulting Engineers.


The Faculty of Architects and Surveyors.
The Landscape Institute (Incorporating the Institute of Landscape Architects).
The National Association of Estate Agents.
Glasgow Property Owners and Factors Association Ltd.
Institute of Registered Architects.
The Association of Optical Practitioners.
Guild of British Dispensing Opticians.
The Pharmaceutical Society of Great Britain.
The British Medical Association.
The Institute of Chartered Shipbrokers.
The Incorporated Law Society of Ireland.
National Federation for the Self Employed.
Bank of England.
Society of Industrial Artists and Designers.
The Stock Exchange.
Chartered Institute of Patent Agents.
Institute of Actuaries.
Faculty of Actuaries.
Institute of Chartered Secretaries and Administrators.
Incorporated Society of Valuers and Auctioneers.
The General Council of British Shipping.
Federation of Bakers.
Leeds Chamber of Commerce and Industry.
Branded Furniture Society.
National Television Rental Association Ltd.
The British Precast Concrete Federation Ltd.
Bradford Chamber of Commerce Incorporated.
P &amp; O.
Metal Box Ltd.
National Federation of Wholesale Grocers and Provision Merchants.
Federation of Optical Corporate Bodies.
Manbre Sugars Ltd.
Joint Committee of Opthalmic Opticians.
1972 Industry Group.
National Association of British Market Authorities.
Pilkington Brothers Ltd.
Arthur Anderson and Co.
Deloitte and Co.
IBA.
Committee of London Clearing Banks.
Du Pont (UK) Ltd.
The Wholesale Floorcovering Distributors Association.
British Agrochemicals Association.
Hire Purchase Trades Association.
Committee of Scottish Clearing Banks.
Shipbuilders and Repairers National Association.
The Society of British Gas Industries.
British Ports Association.
National Ports Council.
British Steel Corporation.
Association of District Council Treasurers.
BP Oil Ltd.
Shell (UK) Ltd.
Esso Petroleum Co. Ltd.
Association of British Abattoir Owners.
Association of Cereals Food Manufacturers Ltd.
Association of Butter Blenders and Butter and Cheese Packers.
Association of Fish Meal Manufacturers.
Association of Malt Products.
Automatic Vending Association of Great Britain.
British Soft Drinks Council

British Sugar Corporation.
British Sugar Refiners Association.
British Association of Grain, Seed, Feed and Agricultural Merchants Ltd.
British Maize Refiners Association.
British Oatmeal Millers Association.
British Soluble Coffee Manufacturers Association.
British Association of Manufacturers of Bakers Yeast.
British Association of Plant Breeders.
The Cake and Biscuit Alliance Ltd.
Cocoa Chocolate and Confectionary Alliance.
Compound Animal Feedingstuffs Manufacturers National Association.
Coffee Trade Federation.
Confederation of Fried Fish Caterers Association.
Dairy Trade Federation.
Federation of Oil Seeds and Fats Association.
Fruit and Vegetable Canners Association.
Federation of UK Milk Marketing Boards.
The Grain and Feed Trade Association Ltd.
Health Food Manufacturers Association.
Ice Cream Alliance.
Ice Cream Federation.
Lard Association.
Bacon and Meat Manufacturers Association.
The Maltsters Association of Great Britain.
Margarine and Shortening Manufacturers Association.
National Association of Master Bakers Confectioners and Caterers.
National Association of British and Irish Millers Ltd.
National Association of Perrymakers.
National Federation of Fish Fryers Ltd.
National Council of Concentrate Manufacturers.
National Seed Development Organisation.
National Association of Creamery Proprietors.
The Pet Food Manufacturers Association.
Pre-Packed Flour Association.
The Raw Fat and Bone Processors.
Scottish Association of Master Bakers.
The Scottish Association of Soft Drinks Manufacturers.
Seed Crushers and Oil Processors Association.
Tate &amp; Lyle Refiners Ltd.
Tea Buyers Association.
Tea Trade Committee.
The UK Association of Frozen Food Producers.
Ulster Curers Association.
Allied Grocery Distributors Ltd.
British Potato Traders Consortium.
British Poultry Federation Ltd.
Cocoa Association of London Ltd.
The Combined Edible Nut Trade Association.
Spice Trades Section of the Food Manufacturers Federation.
British Frozen Food Federation.
British Association of Canned Food Importers and Distributors.
Delicatessen and Fine Foods Association.
Federation of Agricultural Co-Ops UK Ltd.
Federation of British Port Wholesale Fish Merchants Association.


Fruit Importers Association.
Honey Importers and Packers Association.
Imported Meat Trade Association.
London Chamber of Commerce Inc.
Mace Marketing Services Ltd.
National Association of Health Stores.
National Dried Fruit Association.
National Edible Oil Distributors.
National Egg Packers Association Ltd.
National Egg Producers and Retailers
Association.
National Federation of Fruit and Potato
Trades Ltd.
National Union of Licensed Victuallers.
National Federation of Meat Traders.
National Food and Drink Federation.
National Union of Small Shopkeepers of Great Britain and Northern Ireland.
Retail Fruit Trade Federation Ltd.
Scottish Federation of Meat Traders Associations.
Spar (UK) Ltd.
National Joint Council of British Potato and Vegetable Merchants.
Wholesale Confectioners Alliance.
UK Provision Trade Federation.
National Federation of Fishmongers.
British Flower Industry Association.
British Grass Crop Dryers.
National Federation of Inland Wholesale Fish Merchants.
Herring Buyers Association Ltd.
Association of British Salted Fish Curers and Exporters.
Hotel, Catering &amp; Institutional Management Association.
Industrial Catering Association.
Restaurateurs Association of Great Britain.
Rusk Manufacturers Association.
Scottish Trade Flour Association.
UK Flour Importers Trade Association Ltd.
United Kingdom Rice Millers Association.
The Bakers Allied Traders Association.
British Caramel Manufacturers Association.
British Glucose Manufacturers Association.
British Modified Starch Manufacturers Association.
British Starch Importers and Dealers Association.
British Pearl Barley Millers Association.
British Association of Feed Supplement Manufacturers Ltd.
Northern Ireland Grain Trade Association Ltd.
Ulster Sea Fishermans Association.
Fish Producers Organisation Ltd.
Ulster Wholesale Grocers Association.
Northern Ireland Fish Producers and Exporters Association.
Northern Ireland Master Butchers.
Northern Ireland Milk Alliance.
Northern Ireland Retail Fruit Trade.
Northern Ireland Retail Fish Trade.
Northern Ireland Bakers Employers Council.
Northern Ireland Hotels and Caterers Association.
Irish Wholesale Fruit Merchants Association.
North of Ireland Grocers Association Ltd.
North of Ireland Wholesale and Export Meat Association.
Northern Ireland Poultry Federation.
Total 278 organisations.

Oral Answers to Questions — CHANCELLOR OF THE DUCHY OF LANCASTER (ENGAGEMENTS)

Mr. Rost: asked the Chancellor of the Duchy of Lancaster if he will list his engagements for 14th March.

Mr. Greville Janner: asked the Chancellor of the Duchy of Lancaster what are his official engagements for 14th March.

Mr. Tim Renton: asked the Chancellor of the Duchy of Lancaster whether he will list his engagements for 14th March.

Mr. Skinner: asked the Chancellor of the Duchy of Lancaster what are his official engagements for 14th March.

The Chancellor of the Duchy of Lancaster (Mr. Harold Lever): Apart from my duties in this House, I have meetings today with ministerial colleagues and others.

Mr. Rost: As chief trouble-shooter and the expert on lavish handouts from public funds to the motor industry, will the right hon. Gentleman tell us what advice he will give the Government today about British Leyland? Does he recommend another blood transfusion of taxpayers' money or the operating table, or does he intend to sit back and wait for a decent funeral?

Mr. Lever: I do not know whether the hon. Member was expressing curiosity about British Leyland or whether he was anxious to emit a stream of well-prepared sarcasms. I shall assume that he is curious to have my views about British Leyland. Like all Government Ministers I am greatly concerned about Leyland's problems, but I have nothing whatever to add to what has been said on this subject by my right hon. Friend the Secretary of State for Industry.

Mr. Skinner: I get the impression that my right hon. Friend will be finishing up in Birmingham some time later this week as he seems to dabble in most of these matters. Will he go to the Treasury and ask his colleagues there how much money has been lost in taxes as a result of the setting up of the Bank of England lifeboat scheme a few years ago? Will he agree with me as an expert on financial matters


that the clearing banks and others taking part in this rescue scheme are setting off certain payments under it against tax payments that otherwise would be paid to the Treasury? Would it not be a good idea to publish the exact amounts lost to the Treasury arising out of the scheme?

Mr. Lever: I do not know whether my hon. Friend is describing himself or me as a financial expert or whether he was referring to both of us. His question implies that he is dissatisfied with the operations of the Bank of England and the joint stock banks under the lifeboat scheme. In fact the scheme was organised by the Bank of England, and its most valuable and important effect has been to stabilise financial considerations in the City of London at a difficult time.

Mr. David Price: When the Chancellor gives advice to the Government later today on the future of British Leyland, will he take account of the fact that the company is too centralised and too large, and that its factories are too big? While these factors may amount to economies of scale on paper, will he realise that the diseconomies in human terms are absolutely shattering? If British Leyland is to succeed it must be broken down, if not broken up.

Mr. Lever: I will convey those views to the Secretary of State for Industry. The hon. Member will not expect exhaustive comments from me at the moment, and I hope that he will not be disappointed if his suggestions do not strike the Secretary of State with the shock of novelty.

Mr. Ronald Atkins: May I refer my right hon. Friend to my letter of 9th February 1976 complaining of injustice to one of my constituents, a Mrs. Moyles—a view confirmed in the report of Sir Douglas Osmond? Will he guarantee that the forthcoming report on the actions of the Chief Constable of Lancashire will not be shelved?

Mr. Lever: This matter and any other matter will receive very careful, earnest and impartial consideration. None of these problems is ever shelved.

Mr. Tebbit: Has the right hon. Gentleman been thinking today of possible cuts in Government expenditure? If so, as he

came in before the end of Question Time to the Secretary of State for Prices and Consumer Protection and saw the performance of all the Ministers on the Front Bench today, does he agree that that Department would be a very suitable subject for massive cuts in expenditure? Will he agree that by abolishing the whole lot of them he could achieve considerable expenditure cuts, as they have done nothing to keep prices down and they put up a thoroughly shameful show today?

Mr. Lever: I certainly do not accept the disparagement of my right hon. and hon. Friends in answering Questions today. The fact that they did not give the hon. Member total satisfaction is not, to my mind, any proof of incompetence. If the hon. Member is searching for significant and valuable economies, he will not find them by abolishing that Department, whose administrative expenses are negligible.

Mr. Canavan: asked the Chancellor of the Duchy of Lancaster whether he will list his official engagements for 8th February.

Mr. Lever: As well as meetings with my officials I spoke to a Financial Times conference on world banking.

Mr. Canavan: Did my right hon. Friend tell the conference on banking that the four major clearing banks announced annual profits of about £700 million at the same time as the country was faced with a 17 per cent. rate of inflation and unemployment of 1½ million people, due largely to lack of investment in industry? Is it not time that the Labour Government implemented Labour Party policy by extending public ownership into banking, instead of setting up a "phoney" inquiry under the leadership of my right hon. Friend the Member for Huyton (Sir H. Wilson)?

Mr. Lever: I gather that my hon. Friend is not satisfied with any impartial inquiry into the banking system. The only inquiry that would satisfy him would be one that guaranteed in advance a result that was palatable to him. I reaffirm, as I have done many times from the Dispatch Box, that it is not Government policy to nationalise the banks. The recommendations of the committee


remain to be seen. It will be a very thorough and careful inquiry, and if my hon. Friend has any information that is very telling or compelling in the direction that he wishes the Government to go he will have an ample opportunity to submit evidence to the committee of inquiry.

Mr. Adley: Has the right hon. Gentleman had any time since 8th February to consider the unfortunate situation in which he appears to find himself in his Manchester, Central constituency? It appears that he is the latest Labour Member to suffer a putsch. Will he take comfort from the fact that, even if his new executive does not hold him in great esteem, many hon. Members in this House do, even though we do not always agree with him?

Mr. Lever: I am grateful for the expression at the end of the hon. Member's remarks. I assure him that there has been no putsch in my constituency, and relations between me and my management committee continue to be warm and cordial even though there are often ideological differences of emphasis on certain points. None of this will detract from the esteem that the hon. Member was generous enough to express. It is shared by people of very different political opinions to his in my constituency, as it can be within the traditions of our political life in this country. I hope that will continue to be the case.

Mr. Heffer: Will my right hon. Friend recall that on 8th February, while he did not explain the Labour Party's policy on public ownership of the banks, I certainly did? The international bankers—and the British bankers for that matter—did not receive the proposals with any enthusiasm. Therefore, there will obviously be a tremendous political fight to get our case over.

Mr. Lever: My hon. Friend the Member for Liverpool, Walton (Mr. Heffer) in his time has treated certain aspects of party policy as something less sacred than the tablets of the law. Therefore, he will excuse me if I take the official policy of the Labour Party as sometimes not being completely compelling and that I have a right to express a dissident opinion. In regard to the experience, which I shared with him, in addressing the world banking

conference, it is true that my hon. Friend expressed forthright support for the line of the National Executive, which differs somewhat from Government policy as it stands at present. I did not perceive signs of immediate and urgent alarm on the part of the bankers at my hon. Friend's statement of his opinion. I must confess that I did not see any marked signs of enthusiasm for his proposal. That proposal is, none the less, one that can be debated, argued about and proceeded with or discarded according to the judgment of a wise Government.
For my part, I fervently hope—and I am confident—that the Government will continue to regard as irrelevant to our purposes the wholesale nationalisation of our clearing banks. But that is a matter for democratic decision, via the normal democratic processes which I am sure my hon. Friend will do his best to shape in the direction of which he approves. I am sure he will not resent it if those with a contrary view fight as vigorously as he does in expressing his view.

Mr. Costain: In view of the differences between the Government Front and Back Benches on the subject of our democratic processes, will the right hon. Gentleman advise his right hon. Friend the Prime Minister to hold a General Election so that the differences will be settled once and for all?

Mr. Lever: The hon. Gentleman is quite wrong in supposing that there is any rancour or acrimony between my hon. Friend the Member for Walton and myself. It is possible to have differences of opinion on various items without in any way prejudicing the common agreement and purpose in seeking to improve economic and social conditions in our country. The hon. Member for Folkestone and Hythe (Mr. Costain) would be well advised to spend any surplus energy or emollience he possesses in soothing the interminable back-biting that goes on between Opposition Members. At least Labour has only one leader. The Opposition faces the difficulty of having one official leader and a number of unofficial candidates for the leadership. I recommend to the hon. Gentleman that he should look after the Conservative Party and let Labour Party Members resolve in discussion their own differences of opinion, wherever those exist.

BUILDING SOCIETIES (MORTGAGE RATES)

Mr. Walter Johnson: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the refusal of the building societies to reduce mortgage interest rates to 4 million people buying their own homes on mortgage".
I regard this matter as urgent and important because the building societies have given no undertaking that they intend to reduce the interest rate, despite the fact that the minimum lending rate was further reduced last Thursday. Therefore, there is no reason at all why the mortgage interest rate should not be reduced by 1¼ per cent.
Such a move would effectively reduce the cost of living for those 4 million people buying their own homes on mortgage. A person who is buying his house on a £10,000 mortgage over a period of 25 years would, if the interest rate were reduced by 1¼ per cent. save £9 a month.
This is a time when all people—we in this House, and those in commerce, industry, trade unions and in the Government—are doing our best effectively to reduce the cost of living. I regard the building societies' attitude as blatant disregard of the national interest, and I think that the matter is urgent enough to be debated immediately in this House.

Mr. Speaker: The hon. Member for Derby, South (Mr. Johnson) asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter which he believes should have urgent consideration, namely,
the refusal of the building societies to reduce mortgage interest rates to 4 million people buying their own homes on mortgage".
I have listened carefully to the hon. Gentleman and have taken into account the several factors set out in the Standing Order, but the House knows that I am not called upon to give reasons for my decision.
I have to rule that the hon. Gentleman's submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

STATUTORY INSTRUMENTS, &c.

Ordered,
That the draft Transport Boards (Adjustment of Payments) Order 1977 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Tinn.]

STATUTORY INSTRUMENTS, &c.

Motion made, and Question put,
That the draft European Communities (Definition of Treaties) Order 1977 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Tinn.]

Several Hon. Members: rose—

Mr. Speaker: Are there 20 hon. Members on their feet?

Mr. Skinner: There are a lot more than 20.

Mr. Speaker: I am very slow in counting.

Not less than 20 Members having risen in their places and signified their objection thereto, Mr. SPEAKER declared that the Noes had it, pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &amp;c.).

STATUTORY INSTRUMENTS, &c.

Motion made, and Question put,
That the draft European Communities (Definition of Treaties) (No. 2) Order 1977 be referred to a Standing Committee on Statutory Instruments. &amp;c.—[Mr. Tinn.]

Not less than 20 Members having risen in their places and signified their objection thereto, Mr. SPEAKER declared that the Noes had it, pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &amp;c.).

LONDON DOCKLANDS (EXPENDITURE COMMITTEE'S REPORT)

3.35 p.m.

Mr. James Boyden: I beg to move,
That this House takes note of the Fifth Report from the Expenditure Committee Session 1974 –75 (House of Commons Paper No. 348) on Redevelopment of the London Docklands, and of the relevant Government observations (Command Paper No. 6193).
This inquiry was undertaken by the Environment Sub-Committee of the Expenditure Committee under the chairmanship of the hon. Member for Daventry (Mr. Jones). The Committee interrupted a long inquiry into the new towns and set up a short inquiry into the development of the docklands.
The Committee confined itself to three main issues: the public expenditure implications of redevelopment, the most suitable organisational structure for the purpose, and the implications for regional policy.
The Sub-Committee took evidence between January and March 1975 from all the people with special knowledge and interest in the London Docklands, including the Greater London Council, and the five boroughs particularly concerned. It took evidence from the Dock-lands Joint Committee which co-ordinates the activities of the six local authorities involved. It heard evidence from the Minister for Planning and Local Government, now the Minister of Agriculture, and also from officials of the Department for the Environment.
The Sub-Committee also heard evidence from two former Secretaries of State, the right hon. Member for Worcester (Mr. Walker), and the right hon. and learned Member for Hexham (Mr. Rippon). A number of hon. Members representing docklands constituencies also give evidence, including the present Secretary of State for the Environment, and the Under-Secretary of State for the Environment. Therefore, one hopes that, since they take an interest in this matter and since the report contains a number of constructive suggestions, we shall have a short reply from the Minister today to the effect that sums of money will be made available following the Committee's re-

commendations and that its suggestions will be acceded to.
Almost all the Members of Parliament representing the area concerned gave evidence, including my hon. Friend the Member for Greenwich (Mr. Barnett), who now occupies the Government Front Bench. Evidence was also taken from R. Travers Morgan and Partners, the PLA, the Docklands Joint Action Group and the South-East Economic Planning Council.

Mr. Robert Mellish: My evidence was the best.

Mr. Boyden: Since we heard so much excellent evidence, my right hon. Friend's claim is a slight exaggeration. All the evidence was of an extremely high order.

Mr. Mellish: I thought my hon. Friend had forgotten to mention me.

Mr. Boyden: I mention with great pleasure the contribution of my right hon. Friend the Member for Bermondsey (Mr. Mellish). I hope that he will intervene in this debate.

Mr. Mellish: Yes, I shall—very much so.

Mr. Boyden: The report was published in May 1975 and made these main recommendations: that the Secretary of State should give a firm indication of the amount of financial support he is prepared to give to docklands redevelopment; that planning authorities should be given guidance on priorities for major regional expenditure—that is to say, on the alloction of resources between new towns and the inner cities. We understand that a decision on this matter, and indeed a definitive statement, is fairly near.
I should perhaps declare a vested interest—in fact, two of them in conflict. I have a great sentimental attachment to the docklands because when I was a young man—which was a long time ago—I took a university tutorial class at Toynbee Hall. I grew fond of my students. They were good students, and they believed in putting into practice the matters that they were discussing. Several of them went off to fight in the International Brigade, for the Government side against Franco. Some of them were killed. But their prescience was well demonstrated because, not long after that, others of my students were killed and their


homes destroyed in the Fascist bombing that took place in the docklands.
I was sad that, when I went back to Toynbee Hall after the war, practically all the students had gone, for one reason or another, and the whole atmosphere of docklands had suffered a severe blow. I do not mean that the great community spirit, of which I was privileged to be a part, had gone, but there was such physical destruction that it was almost as though the community had to start again.
I did not have much to do with the docklands for many years after that. I used to fly over the area in a helicopter, and it looks better from the air than close up. I also took part, with the Sub-Committee, in a tour connected with this inquiry. I entirely agree with the comment that the Secretary of State has made in another document, in that he was appalled at the waste and dereliction in the heart of our capital city. That is one of the interests that I declare. I am in great sympathy with the people of the area because of the way in which developments have taken so long to get under way.
My other conflicting vested interest is that I have a new town in my constituency and I can make a great argument—as I shall probably have to do—to the Secretary of State that this new town is unique. Most hon. Members believe that their constituency matters are, if not unique, at least rather uncommon, but I hope that any extra money for docklands will not come from this town. I should agree to a small slowing down in development, but I those towns that are to have continued hope that this town is firmly on the list of expansion I am sure that the Minister will agree that this conflict of interest is one that impartial people can solve.

Mr. Mellish: No one is suggesting that money should be taken away from something else. The docklands area is well worth developing and there is no doubt that extra resources will have to be found. There has been a misnomer. Figures have been talked about by the Committee, and £2,000 million has been bandied about, but no one is suggesting that that money will be spent overnight. It will be spent over many years. Let us not get this out of proportion, because such an argument can continue and nothing will ever be done—not that we are doing much now.

Mr. Boyden: I am not trying to push the argument into that course. But I am sympathetic to the argument made by my right hon. Friend the Member for Bermondsey and I hope that he will be sympathetic to mine.
The third recommendation is that the costs and benefits of surface alternatives to the proposed Tube line, the River Line, should be re-examined. The Dock-lands Joint Committee should continue to be responsible for redevelopment plans for the time being but it should be strengthened by the co-option of more members. The land acquisition disposal functions of the parent authorities under the Community Land Act should be delegated to the Joint Committee in respect of the docklands area. The Secretary of State has made a Press announcement, saying that he is in the process of considering setting up a joint land board to deal with this. Perhaps the Minister can give us some firm information about that proposal.
Another Committee recommendation is that retraining facilities for employment should be provided on a large scale. Again, a fair amount is already going on. Better bus and rail services should be provided as an immediate improvement, at a relatively small cost, to improve access to employment.
The Secretary of State replied to the Committee's recommendation and report in a reasonable time. It took him only three months and that compares favourably with the time that is taken by many other Secretaries of State. In August 1975 he accepted the Committee's recommendations generally. The last sentence of the Government White Paper read:
Within the limits of the resources at its disposal, the Government will do all it can to help the redevelopment of Docklands to go forward with all speed.
I am sure that my right hon. Friend the Member for Bermondsey agrees with that. In April 1976 the Joint Committee published "The Strategic Plan for London Docklands"—to which my right hon. Friend the Member for Bermondsey referred—which envisaged the spending of £2,000 million over the following 15 years. After a short period of consultation, the plan was approved in July 1976. In August 1976 the Secretary of State announced his support for the Committee's proposals but was unable to promise


any additional resources. From time to time, the Expenditure Committee as a whole, and several of its Sub-Committees, have made fairly serious criticisms and strictures about the way in which successive Governments—and this is not a party point—have dealt with the economy and the financial contribution that afflict us most of the time. A committee investigating hospital buildings said that quick cuts damaged value for money. Other committees have said that such cuts are extremely damaging to the construction industry.
Here, I declare another interest, because I have a long-standing connection with the construction industry. There is no question but that of all the industries in this country that are going through great difficulties, the construction industry is having the greatest difficulties. It cannot work with stop-go—and mostly there has been stop. If all the recommendations of the Committee—that have been agreed in principle by the Secretary of State—were carried forward with more drive and supported by money, not only would great social advantages be derived in the docklands areas but there would also be great relief and help for the construction industry.
The main point made by the Expenditure Committee—and I am sure that this will come up again during the expenditure debate on Thursday—was that the cutting of capital expenditure as compared with current expenditure is bad for the docklands and particularly bad for the construction industry. I do not think that those of us who have perhaps rather idealistic ideas about the types of buildings that we want for schools, hospitals, houses or whatever, and who want much more activity in building, will ever achieve those ideas until all Governments—and the civil servants who advise them—come to the settled conclusion that there must be a steady development of building and a slowly rising market. But this development, if it is at all possible—and perhaps we need a building Keynes—should be much more sheltered from the effects of economic strictures and difficulties. The effect of the present expenditure plan is that capital expenditure will be cut by 18 per cent. while current expenditure will rise by about 1 per cent. during the next two years.
So much by way of introduction. I should like to thank Members of the Sub-Committee because this has been an extremely hard working Sub-Committee. We were most grateful to the hon. Member for Daventry, who chaired the Sub-Committee. Its report was completed in good time. Yet did not cut any corners. It has done what I have set out to do as Chairman of the Committee—to improve relations between the Committee and the Departments—with which it is particularly concerned. There is no intention to make the Committee the lackey of the Department, but rather to keep at them and to develop and keep the subjects is which the Committee is interested moving in the right direction.
We say some severe things at times and there is sometimes acrimony between Ministers and the Committee, but generally, the Committee cannot function unless there is confidence between the Secretary of State, Permanent Secretaries and civil servants in the work of the Committee and in building up their evidence. If a Secretary of State digs in his heels and refuses to give evidence, or gives only muted evidence, there may be a row in the House, but nothing will come of it.
Despite what has been written in The Guardian, I have been pleased at the way in which, with rather limited resources, the committees have been able to build up good relations over a wide area. I may have something more to say about that in the next debate.
It is wrong to minimise the effort and results of the Expenditure Committee, which does not imitate the lavishness and careerism rampant in American Congressional committees that produce reports which are no better than those of ours.

3.52 p.m.

Mr. Arthur Jones: I am grateful to the hon. Member for Bishop Auckland (Mr. Boyden) for the kind things that he said about the work of our Committee and I am sure that my colleagues on the Committee will wish to add their thanks. It is reassuring to note that the Sub-Committee has played some part in the overall objectives set by the hon. Member for Bishop Auckland for the Expenditure Committee as a whole. We hope to continue to play a part in our future inquiries.
The hon. Member for Bishop Auckland has set the wide scene of the debate, not only in terms of the Sub-Committee's recommendations but on the broader scene of the current economic situation. I shall be touching on some of these issues later. I am glad that the hon. Member mentioned the evidence of the right hon. Member for Bermondsey (Mr. Mellish). It was characteristically lively and he brought to our deliberations a great wealth of experience. The right hon. Gentleman need not be apprehensive about those of his remarks that I am about to quote. It was characteristic when he said:
Therefore, I am talking very much from the heart and, I hope, with a bit of brain too.
May I add that he spoke with more than a grain of common sense as well.
The right hon. Gentleman also said
here is a dramatic chance for a redevelopment of the area, not just for the people I have the privilege to represent but a chance for London, which I think is the greatest city in the world".
Many of us would join the right hon. Gentleman in that comment. I hope that the Committee responded to the right hon. Gentleman when he said, a little teasingly:
With the knowledge that what I am about to say will probably be read by those interested I had better watch my words.
I am glad to say that he did not watch them too carefully and, in giving evidence, he gave us a thoroughly enjoyable hour or two.
The Fifth Report of the Expenditure Committee arises from evidence taken during the early months of 1975 and is contained in House of Commons Paper No. 348 which was published on 28th April. It was followed by the Government's observations in Cmnd. 6193 in August. I agree with the hon. Member for Bishop Auckland that we were grateful to have such a prompt response to our recommendations and the observations contained in our inquiry.
The Committee was fortunate to have as its special adviser Mr. David Starkie, a university lecturer at Reading University. We just got our report out in time before he went on secondment to Perth to advise on highway problems in that part of Australia. He was away for about 18 months and has now returned. I am in

touch with him again and I hope that he will be able to help us with subsequent inquiries. The Committee undertook its inquiry in the context of the rising concern, both in London and elsewhere, about the increasing dereliction of the docklands area, which comprises 5,500 acres lying immediately beyond Tower Bridge on both banks of the river, extending as far down stream as Barking Creek.
It is common knowledge that the redevelopment had been considered during the Conservative Administration of 1970–74 and we were able to take the views of both my right hon. Friend the Member for Worcester (Mr. Walker) and his successor as Secretary of State for the Environment, my right hon. and learned Friend the Member for Hexham (Mr. Rippon). The right hon. Member for Worcester in May 1971 commissioned the Docklands Report prepared by Messrs. R. Travers Morgan and Partners which was submitted early in January 1973—a commendable sense of urgency on the part of all concerned. It is well known that all five of the suggested alternative developments were rejected by the GLC and the five London boroughs involved with the docklands area.
The strategic plan published for consultation by the Docklands Joint Committee, which was established in January 1974, was published in March two years later—some five years after the initial initiative of the Conservative Administration of 1971. There is, I understand, little to see as yet by way of development and construction work.
The Docklands Development Team reported this month that the loss of the international trade mark at Southwark posed by the American company Messrs. Trammel Crow, which has deferred its plans for development, has been a considerable setback.
Since the summer of 1975, a total of 72 development applications have been approved, with 29 being deferred or refused. In round terms, approvals have been given for 980,000 sq. ft. of industrial and commercial use, 45,000 sq. ft. for offices and 20 acres for residential development. About 1,100 local authorities dwellings are now under construction or due to start shortly and planning is well advanced for other sites which should yield 1,400 dwellings.
In reply to inquiries, no indication is forthcoming of actual construction work, either in terms of a statement of completions or work under construction.

Mr. Nigel Spearing: Will the hon. Gentleman confirm that he is quoting from something? He may be interested to know that more than 100 dwellings are under construction in my constituency, which represents half the docklands area.

Mr. Jones: I do not doubt that they are under construction. My information comes directly from the report of the Docklands Joint Committee and I do not think that I am underestimating what it has done. We have had no statement from the Docklands Joint Committee, in response to inquiries, about completions or work under construction. I am choosing my words carefully.
St. Katherine's Docks and the London Docks were closed in 1968 and the Surrey Commercial was closed in 1960. Messrs. Taylor Woodrow is to be congratulated on its development at the former St. Katherine's Docks. It is an imaginative concept executed to an excellent standard, both in design and workmanship, on a site made available by the GLC.
In commenting upon the present situation after a decade of procrastination, I do so, of course, in terms of my own judgment and I do not speak for my colleagues on the Committee. What I have to say is advisedly in the context of what has been achieved so far—so little in fact—and pays no regard to the optimism which has been a continuing theme down the years from those in charge of this vast undertaking. That is an optimism which in my view is incapable of fulfilment under the existing arrangements and in the present economic climate, unless new principles are accepted.
Commenting on the Sub-Committee's report, the Government say in paragraph 3:
The redevelopment of the London Dock-lands is, of its kind, the greatest challenge of our time, Docklands covers 84 square miles, and is the largest area in London available for redevelopment since the Great Fire over 300 years ago. It is the largest urban area for redevelopment in Europe.
Paragraph 4 goes on to say:
Although the timescale for the operation, and the cost remain to be worked out, there

is no doubt, even now, that both will be very substantial.
That is what the hon. Member for Bishop Auckland emphasised.
In a report which appeared in The Times of 6th April last year, Mr. Percy Bell, the Chairman of the Docklands Joint Committee, is quoted as saying:
We consider that the money can be found to do it, but it is not the committee's money, it is other people's, and they must take the decisions.
By that I think he meant the GLC and the five London boroughs, although it may involve other people including the Government.
Sir Reginald Goodwin, the Leader of the GLC it is said, refused, on the previous day, to consider the alternative strategy for the redevelopment of dock-lands and, when referring to transport facilities including those in London Docklands and Thamesmead, is quoted as saying:
I am not so pessimistic as to accept that the Government will not accept its transport responsibilities. We are waiting for the final document on transport strategy, which I understand is likely to appear next June, and I am optimistic that it will conclude that the Fleet Line is in the national interest.
More recently in the Evening News of 4th March, Mr. Horace Cutler, the Conservative Leader of the GLC, is reported as saying that County Hall should begin work on the £200 million Fleet River Underground line. He will know that when the Department of the Environment representatives, where giving evidence to the Committee, in answer to Question 184 Mr. F. J. Ward, Under-Secretary, London Directorate, told us that the Strand to Fenchurch Street line—of which the new line is an extension—is particularly expensive. It will cost £50 million for 2 ½ miles of Tube.
Mr. Ward told the Sub-Committee:
… in terms of total public benefit it comes out with a ratio of benefits to cost of about 0·3 to 1 for that 2 ½ mile section. That means crudely that you spend £50 million on 2 ½ miles of tube and at the end of the day you have a public asset worth £17 ½ million. The following stage from Fenchurch Street as currently being favoured through the Surrey Docks, the Isle of Dogs and Silvertown to Woolwich and Thamesmead is still at the provisional suggestion stage. I do not think that the line has been fully investigated yet.
He concluded:
Before one commits an act of faith of this sort one needs to see the hard figuring carried a stage further.


The vast resources required to meet the plans apparently laid down by the GLC and the five London boroughs must bring in question how provision is to be made. At the opening of our inquiry—in reply to the initial question—Sir Reginald Goodwin said:
We, as elected members, were quite convinced that given the will to work together, and given the measure of support that Government would give to a body of its own creation we could achieve as good, if not better, results.
That seems to imply that London is prepared to go it alone but that surely cannot be a realistic appraisal.
Considerable central Government funds will be required and, indeed, should be forthcoming in order to fulfil the high expectations of Londoners. All of us who live in the South-East, and, indeed, the nation, want to enjoy a sense of pride in the nation's capital and to raise from the present desolation an achievement for posterity of which we can all be proud.
This vast venture cannot be seen in the context of a parochial outlook which I fear is in evidence in the reply given by Sir Reginald Goodwin to Question 19 in our inquiry. He was asked:
Are we driven into a situation in which each area of docklands is to be considered in relation to the borough in which it lies?
He replied:
Yes, I think so.
The excellent record of the administrative instrument—the development corporation—particularly in new town development and in expanded towns is well documented and acknowledged. Their introduction was on an agreed basis between the Government and the respective planning authority with representation by locally-elected members a common feature. Government funds totalling up to £2,250 million have been made available in the post-war years.
The idea of a development corporation was rejected by the Secretary of State for the Environment in his statement and Press release on 5th August last year when he said:
We must all acknowledge present financial stringencies, and the fact that any shift of resources must be offset against expenditure in other areas.
If that were true seven months ago, how much more immediate and restrictive are Government policies today. Some sacred cows are even being sacrificed.
The emphasis by the Government, reflected in recent speeches by the Secretary of State, is now clearly on the rehabilitation of the disaster areas which post-war development has imposed on some of our inner cities. The social conditions in many places are a thorough disgrace, and in my judgment the major responsibility for those circumstances lies with the local authorities.
They should have recognised from the outset that new town development and the extension of their urban areas into green-field sites would inescapably lead to the rotting of the core of their cities. Clearly they should have ensured that the cost of redevelopment elsewhere should have had regard to the necessity of funding the inner redevelopment. That is the total cost of an exercise in the movement of population, and almost without exception it has gone by default.
In the case of London, population, industry and office development have been encouraged to move to the new towns. The serious position which has resulted is now recognised and belatedly steps are sought to redress the balance. We are faced with a situation in which vast assets have been created elsewhere at the expense of inner London. We should now be looking for a solution which has regard to the benefits, financial and otherwise, which have accrued in the new towns at the expense of job opportunity and environmental considerations in inner London. We should now be looking for "a shift of resources", to use the Secretary of State's phrase.
In terms of the vast assets created in the London ring of new towns—eight in all—according to a recent issue of The Journal, published by the Town and Country Planning Association, over 31 million sq ft of industrial floor space has been completed since their designation, in each case, up to 31st December last. In Corby, Milton Keynes, Northampton and Peterborough a further 10·9 million sq ft has been constructed, to which should be added 7 million sq ft of office accommodation and 7·5 million sq ft of shopping space.
Most of the new towns are thriving with prosperous communities living in a pleasing and socially rewarding environment, in contrast to so much of inner London and other cities. After allowing for infrastructure expenditure the asset


value in the great majority of cases is far in excess of the capital sum expended. It would be interesting to see an exercise undertaken with a view to providing an estimate of the current market value of the assets that are so far in excess, in the majority of cases, of historic values and which should be realised over a sensible period of years by sales to occupiers and institutional investors using the New Towns Commission as the vehicle.
The proceeds should be utilised for inner city renewal and redevelopment to make standards there acceptable in terms of job opportunity and living conditions, particularly for existing communities. I suggest that a policy on those lines could provide a means by which funds for redevelopment could be made available to London Docklands within the financial constraints that will be with us for the foreseeable future. I am suggesting a rollover of assets that would enable resources to be reused on schemes for which resources would not otherwise be available.
In two of the Sub-Committee's recommendations it is suggested that the Department of the Environment should, where a significant Government commitment may be involved, give firm guidance at an early stage about the possible range and/or phasing of public expenditure.
Paragraph 31 recommends that the Department of the Environment should give specific guidance on the level of public expenditure commitment for dockland and that the Government should state their intentions on the question of providing financial support. That statement is well overdue. I understand the dilemma which faces the Government, but let us look for alternatives. Surely that is what we are seeking to do.
The Government's response to these recommendations deals with the eligibility for normal forms of Government financial support for transport, housing and other purposes, and it goes on to say that there are
no plans for special forms of support over and above these.
So when it says that central Government funds will be available, that is not supported in the response to the recommendations of the Sub-Committee's inquiry. Assurance is given, however, that the

Department is prepared to discuss with the authorities concerned the pace at which resources are likely to be available.
I particularly took note of the point by the hon. Member for Bishop Auckland that capital expenditure for the two subsequent years is 18 per cent. down on the figures for the current year. How in that context can we see any prospect of resources coming from central Government funds for the redevelopment of docklands? When the hon. Gentleman referred to the difficulties of the building industry I saw the Minister nod his head in agreement. But it is the Government's policy that is leading to difficulties for the industry. The Government are refusing to cut current expenditure and are crucifying the building industry as well as the whole of investment policy in Britain by not agreeing to substitute a reduction in current expenditure so as to maintain a level of capital expenditure in the two years ahead. When we hear therefore that the
Department is prepared to discuss with the authorities concerned the pace at which resources are likely to be available",
that is just pie in the sky, and everyone knows that to be the case. It is statements such as that which illustrate the continuing uncertainty of resources available for the docklands area and emphasise the absolute necessity for an overall plan under which the resources would be assured.
How can the fulfilment of this vital and necessarily urgent redevelopment be contemplated against the background of a decade of delay and the inadequacy of resources at the disposal of the GLC and the five London boroughs? I hope that the whole question will be reconsidered on the basis of the realities to which I have tried to give emphasis.

4.13 p.m.

Mr. Robert Mellish: I am sure that the whole House is indebted to the hon. Member for Daventry (Mr. Jones) and the members of his Sub-Committee of the Expenditure Committee who have worked so hard to produce this report. I understand that they held 16 meetings and that they visited the docks area, taking masses of evidence. It is no easy task to compile all those facts into this very readable report. I congratulate the hon. Gentleman and


his colleagues on their first-class scholarship.
It is said quite rightly that democracy is the finest system of government in the world. I do not quarrel with that, but I am getting fed up with being a democrat. Democracy provides an excuse for some people to do nothing for ages and ages. This debate is not the first on the subject of the docklands. I have forgotten how many times we have discussed it in some form or other.
When I was the Opposition Chief Whip—and a very good democratic Chief Whip I was—I was allowed to break precedent. My right hon. Friend then the Leader of the Opposition, the right hon. Member for Huyton (Sir H. Wilson), allowed me to speak from the Opposition Dispatch Box in a debate on London docklands. I said then—I think it was the first time it had been said at that stage—that I firmly believed in the establishment of a body like a development corporation in order to deal with this vast area.
It is as well to put on the record the enormity of this area. We are talking about eight and a half square miles, or 5,000 acres, of mostly derelict land which is now to be redeveloped. I would have thought that there was a very good case for establishing a development corporation. It would have finance from the Government and its membership would consist of representatives from evey local authority.
No one is or has been keener than I on local participation, but the idea that this corporation should be an abstract body consisting of strange people who knew nothing of London was never in our minds. However, the body was not to be established.
I wrote on the subject to the then Prime Minister, the right hon. Member for Sidcup (Mr. Heath), calling his attention to this enormous derelict area. I said that something should be done reasonably quickly. He responded in what I regarded as a truly tremendous way. I still have the letter which he wrote back, thanking me, saying he agreed, and that he had instructed the right hon. Member for Worcester (Mr. Walker), who was then a Secretary of State, to do something about the matter.
The right hon. Member for Worcester then established what afterwards became known as the Travers Committee. It took about two years to develop schemes which were all finally thrown away. I make no complaint about that. I do not believe that this argument should be conducted on a party political basis. We could have a lot of fun in that way, but that would be the wrong approach. We should not be trying to score cheap points when we have a chance such as this, a chance which we are missing badly.
Is this debate today to be a charade? Are we to go over the same ground again? Are we all to repeat that this is a wonderful chance, that it is the greatest opportunity ever known in our history, that this is where we could build the London of tomorrow, that this is a great chance and we must grasp it, a chance that no other country has? Are we to say once more that the River Thames is empty of traffic and that we must make the most of that? Are we to go through all that again and then be told that the Government are still considering the matter and that no statement of policy is to be made?
I am a very patient democrat, but if that happens it will show why I am getting fed up with democracy. Sometimes I think that I should have been made a benevolent dictator. You would have made a very good Parliamentary Secretary for me, Mr. Deputy Speaker—

Mr. Deputy Speaker (Sir Myer Galpern): Only on condition that I was the senior partner.

Mr. Mellish: With your tenacity I have no doubt that that would have been arranged as well, Mr. Deputy Speaker. I would certainly have made you my number one head man.
When I broke precedent and spoke from the Opposition Front Bench as Chief Whip I saw that a development corporation was the only way to get the scheme off the ground and secure Government involvement. It was not to be. The St. Katherine's Docks fell empty in 1968. My part of the area fell empty in 1970. Here we are seven years later still debating and having our arguments.
When I went before the Sub-Committee we had reached the stage at which we had to start getting some results, and that was why I bowed to the inevitable. There


is now the Docklands Joint Committee. Let it now work and let us give it some real teeth, some genuine power. The comimttee has worked hard. It is made up of good men who have tried very hard to produce what is in many ways an admirable strategic plan.
The intriguing factor is that the passage of time makes evidence false. My hon. Friend the Under-Secretary has not been a Minister for very long. I have had more experience on the Front Bench than he has, and I have lived with civil servants for a long time. I have great respect for them as a body, because they do a first-class job. But it must be understood that often they will give advice—particularly on planning matters—that proves to be a disaster in later years. I have suffered from that.
Let us look at the evidence that the civil servants gave. But to whom was it given? To the very Committee whose report we are now discussing. What did these bright characters say only two years ago? They said that they could not support the suggestion that the principle of industrial development certificates should be revoked, because they claimed that London was still in a very fortunate position with an average unemployment rate of only 3½ per cent.. All this is there in the evidence to the Committee. I had intended to sort out the relevant parts, but the information is there for anyone interested.
Unfortunately, London is no longer in that sort of position. The planners were wrong then and today's events have proved them wrong. That is the trouble. We have listened to too many stupid planners and theorists. All of us, both Labour and Conservative, have run London down as a result of taking their advice.
They said that London was bloated and had too much in the way of industry and resources and that it had to be reduced. As a result we now have a unique situation. The Secretary of State for the Environment, the lord and master of the planners, now has an unemployment rate of 14 per cent. Is there any civil servant now who would have the nerve to go before a Sub-Committee and argue that the unemployment situation in London did not justify special treatment?

That is what they said in 1975, but they would not say it today.
I should like to reply to my hon. Friend the Member for Bishop Auckland (Mr. Boyden), who spoke about his little old new town and said "Whatever you do in London, do not affect us". My answer is that London is in special need today, and those of us who represent London will keep on saying so loud and clear. We have no vast resources to give to places elsewhere—we have already done that. No one can accuse London of being mean or ungenerous to our friends in the North, in Scotland and elsewhere. The whole story is one of a continual running down of London.

Mr. Boyden: I can bear my right hon. Friend out on that, no doubt to his great surprise. I have been to numerous meetings with London people on this issue. Over the years they have been very generous to the North.

Mr. Mellish: I am obliged to my hon. Friend. I was stupid enough to take the advice of the civil servants. Every time I think about it, I wish I could turn the clock back. I went on my bended knees to 700 constituents and begged them to leave my borough. How stupid can a person get? I do not suppose I shall ever be a Minister again, but if I ever am, the last people from whom I shall take advice will be my so-called planners. Instead I shall use what the Almighty gave me—a fair amount of common sense and acumen. If one does things on a theoretical planning basis, one can make many mistakes.
The Minister who is to reply to the debate will recall a speech that he made when he was a humble Back Bencher, as I am now. I hope that he is using his own evidence today. He ought to be careful about the advice he receives from his civil servants. As a Back Bencher my hon. Friend rightly spoke out loud and clear for London. He was worried about his own borough of Greenwich. He was worried sick about the borough and its unemployment prospects. He saw the writing on the wall and said so, making his views abundantly clear. Since then, the problems have got worse, not better. I return to the basic statement of the case. If we are to have just another debate and to hear again everything that has been said before and we are then to


be told at the end that this is all very well, but the Government are not promising any action, this debate will be a charade and a waste of time.
I turn now to the subject of the Dockland Joint Committee. I screamed my head off in the past about wanting a development corporation, but I lost out. That is what happens once the old parochial politics gets going. Perhaps I should have carried on fighting, but I got out of the way and stayed out of the argument.
I told the House at that time that of course I knew I was getting parochial. I have moved away from my old ideas. I know that I should be concerned and worried sick about the constituency of my right hon. and hon. Friends the Members who represent the borough of Newham.
I am glad to see that the right hon. Member for Worcester has joined us. I was saying some nice things about him, so he need not worry.
I know that I should care, but in fact I do not care what happens in Newham. I am concerned only with what happens in Bermondsey and Southwark, which contain about 540 acres of dockland, about one-tenth of the whole dockland area. But so far nothing has been built. We have acquired 134 acres, comprising 114 acres for housing and open space and so on, and 20 acres for industry. In that riverside area we own 1,200 existing homes.
Looking at the history of that area, we can see that that was a planners' mistake of yesteryear. This part of the constituency is called Downtown and is separated from the rest of the constituency by swing bridges and appalling traffic problems. Everyone who lives there is referred to as a Downtowner. In the 1920s Dr. Alfred Salter, a very great man who was a Member of Parliament, because local authority powers of acquisition were very limited and this area had been flooded when the River Thames swept over a small wall—later the authorities built a very large wall—promoted a private Bill to acquire the land. He built council flats, which at the time were a joy to behold. People came from all over Europe to see them. These council flats had separate toilets and bathrooms,

kitchens and the rest, and they are still very good flats.
But it was a terrible mistake to build them there. They should never have been built in that location. They are right on the river front near to lead mills, oil refineries and companies dealing with the disposal of dust and dirt. Everyone said when the flats were built that this did not matter, but it was a planning disaster and I do not think that I have ever held a surgery without one or two Down-towners complaining about the problems with which they are living.
I have seen the strategic plans for the area. The local strategic plan was to sweep away these homes and start again. I do not want to get rid of the lead mills or the refineries or the companies that dispose of dust and dirt. They are an essential and integral part of industry, and it is right that they should be isolated to do their jobs.
Another thing that the local authority did in the remit of the joint council was to acquire 134 acres for the Trammell Crow International Trade Mart. I never went there and never took any interest in the matter. Some people went off to Texas and were convinced that it was a good thing. I was not concerned about who actually went, but whether they would make any noise and whether they would be successful, and whether they would attract the sort of industries that ought to be there.
I understand that there was a possibility of the firm of Trammell Crow moving there, but this has been held up because the Americans who own the Company are not satisfied with the economic climate in Great Britain at the moment. I also understand that we are negotiating with the Port of London Authority for a further 90 acres.
There can be no doubt that the Dock-lands Joint Committee has been working to acquire land. Much land is now within its grasp. Do no let it be said that the committee does not have the land. In 1970 I said that the problem was to acquire land at a price that people could afford to pay, but my local authority now has the land.
We went in for a massive extension of public consultation—as I said earlier, I am getting fed up with democracy. I


went to a few meetings. The first meeting that I attended was told that we would have a great marina. I told the packed audience that I was not opposed to a marina, but I had been running surgeries in a constituency for 25 years and every point of view had been raised, but there had never been a complaint that people could not moor their boats. So we dropped the idea of the marina.
After that, I was more confirmed than ever in the view that we should have a development corporation. However, the idea of the marina arose so many years ago that I had almost forgotten about it and remembered it as I was speaking.
We had a public consultation exercise. We now have the strategic plan. As I understand it, much of the land is now owned by the local authority. I have seen details of the type of housing that the local authority would put on the 134 acres. I am impressed to this extent: the housing would certainly conform to what I have always dreamed of for this area. I do not want people, long after I am dead and forgotten, coming down the river in boats, looking at the area and saying "Local authority housing". Let us cut out that possibility.
Let us have houses with small gardens, houses painted in different colours. We do not want houses in the old council house brick style, so that a person who has opened one council house door has opened every council house door, so to speak. Let us have houses with roofs of different colours. Let us have gaiety and colour. After all, gaiety and colour do not cost much, pore money than drab housing. Let us not have council housing per se. Let us have imagination and houses built of such style and quality that people will really want to live in them. The strategic plan has convinced me that the local authority really has something of this kind in mind.
I am excited by another detail of this scheme. It may be only a pipe-dream, but I like people who have dreams. There was a suggestion that a shopping precinct would be built in my area and that it would be accessible by boat. That is not so daft. Why should not people in the locality use boats if they want to use them? It sounds fun. Of course, the precinct could also be reached by

roads designed and built. Why should not this be so?
Would it not be tremendously exciting if Londoners were able to use the river? Most of us in Bermondsey never saw anything of the river unless we worked in the docks. After all, the industry and the area were built for the Industrial Revolution. However, there is hope in these proposals.
I come now to the crunch. I have read very carefully the evidence given by the right hon. Member for Worcester two years ago and I fully agree with it. He said that there should be a development corporation. The right hon. Gentleman said—I fully endorse his evidence—that without a development corporation it would not be possible to have the type of schemes that my local authority wants, that the GLC wants and that, for example, Mr. Cutler wants. Incidentally, it is too early for Mr. Cutler to start playing party politics yet. There is another month before the GLC elections. We shall deal with that bright character when we get round to him. The right hon. Gentleman said that there should be a development corporation and that the solution was an injection of capital from the Government and guarantees of future capital from the Government.
No doubt my hon. Friend the Member for Newham, South (Mr. Spearing) will get involved in an argument about the transport plan. Mr. Freddie Ward gave a ratio of 0·3 to 1. How I love figures such as that. If I had been there when he said that, I would have given him "0·3", because it is rubbish.
London's Underground system virtually stopped dead at the end of the Victorian era. There has been little building since. It is a disgrace that there are vast areas of Lewisham, Beckenham and Catford with not one Tube station in sight. What experience of Tube stations have the constituents of my hon. Friend the Minister unless they come up this end? If they stay down where they are, they will never see one. The present situation is a scandal.
We want a River Line. To get it we need a firm guarantee from the Government that the money will be found in the future. My hon. Friend the Member for Bishop Auckland is worried sick, but nobody is suggesting that the £2,000


million, or whatever amount is likely to be spent—these are only rounded figures—is to be spent immediately; it is to be spent over a period of 20 years.
It is absolutely essential that the Labour Government—or, if the Tories get in, a Tory Government—say to the Docklands Joint Committee "We will underwrite the transport system and find money for this year alone so that a number of essential works can be started." I am advised that if that were done a great movement would take place and that much more would be done.
If my hon. Friend the Minister denies that, he will have to spell it out and tell me what the local authorities can and should do which they are not now doing. I do not come to the House and attack the Government without being aware that at the local level I could make attacks if I wanted to.
Let us have a clear statement from the Government. If we can have an assurance that the Government of the day, conscious, as they must be, of the great chance that lies before us—there is no need to get too emotional about it again—will underwrite the transport proposals—the River Line—and be behind the Docklands Joint Committee, just as if it had been a development board, that will give these people the chance to do the job.
I come to a point on which my hon. Friend the Member for Newham, South and I speak with a difference of emphasis. A short time ago we attended a meeting of the South-East Economic Planning Council. I was very impressed. The Committee is composed of very able members under the chairmanship of Lord Porchester. The Committee questioned my hon. Friends the Members for Newham, South and for Newham, North-West (Mr. Lewis). They were in agreement with our sentiments when they said to us "We are the South-East Region. If there is to be a major contribution from our region to the docklands"—in other words, with a smaller amount of resources going to other parts of the region so that more resources could be found for the docklands—" we want an assurance that the body which will be running the docklands will be efficient and will be able to attract industry in its own right"—which development corporations always could and did.
I hope that the Minister will deal with this aspect of the subject. The Dock-lands Joint Committee must be a body with sufficient authority and prestige to be able to attract industry. With respect to my hon. Friend the Member for Bishop Auckland, it must be able to tell industry that it can have premises in the dock-lands at cheap rents. Why should not that happen? Why should people be able to go to Bishop Auckland at cheap rents? Why should not we have a preference now? Some of us now have 14 per cent. unemployment in our areas.
What is needed above all else is an injection not only of capital from the Government but of confidence from the Government that this scheme will now be started, that it will gather speed quickly, and that eventually we shall have the type of development of which we can all justly be proud.

4.40 p.m.

Mr. Kenneth Baker: It has become fashionable for ex-Ministers of all Governments to admit that their records while they were Ministers were less than perfect. The cries of "mea culpa" rend the air. But no one lays the lash upon his own back with so much relish as does the right hon. Member for Bermondsey (Mr. Mellish).
If I may say so, the lash is well deserved. I think that he was Minister of Public Buildings and Works in those heady days in 1964 to 1965, when the Government actually introduced office development permits to drive office jobs out of London, because that was then the fashion. We were all persuaded to believe that there was an enormous concentration of work in central London and that we would have to push out work. Following the census in the mid-1960s and again in 1971 it became evident that London was declining and that job opportunities were declining at an increasingly rapid rate. In London industrial jobs are now declining at seven times the national average and office jobs at nine times the national average.
I was not a member of the Select Committee and I do not represent a dockland constituency, but no one who represents a constituency in inner London can fail to be concerned about the fate of this enormous area in inner London—eightand-a-half square miles, or 5,000 acres—which has been described as the largest


development site within a city in the whole world.
As I read through the Select Committee's report over the weekend I sensed that its flavour was almost historic. It was an out-of-date document. The right hon. Member for Bermondsey has reminded us that it referred to unemployment rates of 3½ per cent. and 4 per cent. There was an air of optimism running through it that something was going to happen, that we were on the threshold of some great change.
The Government went even further than the Select Committee, because in their conclusion on the Committee's report they said:
The redevelopment of dockland will take at least 15 years to complete.
That was probably the high point of complacency of this Government. In August 1975 they said that the whole redevelopment of these 5,000 acres would take a mere 15 years to complete, yet now, two years later, work has not even started, as the right hon. Member for Bermondsey reminds us.
If we look at some of the other things the Government have said we begin to see why. In paragraph 8 they say:
The Government is already taking steps to bring local authorities more into its forward planning of public expenditure.
That was the prelude virtually to telling the local authorities, in the words of Tony Crosland, "The party is over", and that is really what the debate is all about.
I agree with what the right hon. Member for Bermondsey said about the Dock-lands Joint Committee. There were high hopes of it, but these hopes were all misfounded. I am afraid that dockland has become something of a political football. My right hon. Friend the Member for Worcester (Mr. Walker) tried to do something about it, and he set the whole thing in motion. He tried to do what any senior Minister would do to get the ball rolling as quickly as possible, and he got the report quickly—indeed, I think that it was while he was still holding the post of Secretary of State for the Environment. As former Ministers will know, it is rare for that sort of thing to happen so quickly.
After the change in power at the GLC, the report was quietly put on one side.

The five alternatives put forward were rejected by the London boroughs and the GLC. There was a great deal of political motivation and bias in that.

Mr. Mellish: The hon. Gentleman must speak for himself, but I do not think that the right hon. Member for Worcester (Mr. Walker) was very impressed with the report either.

Mr. Baker: I suspect that if my right hon. Friend had still been responsible in 1974 and 1975, something would have happened in the development of dockland because he was determined to get a proposal off the ground. I believe that the right hon. Gentleman's strictures about the delays of democracy and the attitudes of planners have a lot to answer for in the decline of the inner city and central London.
But I believe that a sturdy realism should now dominate this debate. The figures for the redevelopment of dockland are somewhere between £1,000 million and £2,000 million over the long period. I do not believe that any Government of any complexion will find that sort of money for the development of dockland over the next decade. I say that because other hon. Members representing other parts of the country will demand their share of what is going around, and they will say "Why should London get more? It is still a very prosperous city."
They will overlook the fact that unemployment in Tower Hamlets is 14 per cent. and that London is not one huge champagne belt where the lucky and idle rich live. They will overlook the deprivation and the fact that jobs are being lost in London at a great rate. But they will also point out that in spite of this London none the less still accounts for half of the nation's transport subsidies and one-third of the nation's housing subsidies. By those standards those of us who represent London must accept that we shall not receive a disproportionate share of the nation's resources even if it is to develop something which obviously needs development, such as dockland.

Mr. Spearing: Would the hon. Gentleman accept that there is a possible way of doing this without affecting the development areas, namely, by transferring the expenditure plans for the South-East of England, which are in the Government's


plans, to the inner areas of London, particularly dockland? That would not require any further expenditure and would not prejudice the health of any development areas.

Mr. Baker: The hon. Gentleman is looking for too simple a solution. It is simply not possible, with all the complexities and conflicting interests of local authorities in the South-East of England, to say that we shall not be developing any other parts of the South-East, that it will all take place in Tower Hamlets, Greenwich, or Bermondsey. The Secretary of State for the Environment does not have adequate powers to enforce that. However, I shall deal with that point more fully when I make some suggestions later.
I was saying that I did not believe it was realistic to think that these sums of money will be made available in the course of the next 10 years or so despite the crying need of these areas. But what should be done? First, one of the principles to which we should try to stick in the redevelopment of dockland is that it should be a mixed development for social and cash reasons. I shall deal first with the social reasons.
The first constituency I fought in 1964 was Poplar. I became very familiar with that part of dockland, including the Isle of Dogs, Bow and Poplar. It was quite clear to me then that that was a one-stratum society, and now all the demographers and the Socialists prove this to be so. They can show that only one in 20 of the people in that area live in owner-occupied houses and only 4 per cent. of those working in that area have A-levels. That is totally uncharacteristic of the rest of London. The sort of groups that are necessary in any society—the teachers, the senior local government officials—have almost abandoned living in this area. To be brutally frank, they commute, and this was the trend in 1964.
I believe that the area of one-stratum society in the East End is about as representative of British society as is Belgravia. In the dockland, and in the East End, both north and south of the river, it is important to try to recreate a mixed community. This means a much greater encouragement of privately developed housing.
In 1964 some of us tried to set up a housing association in Poplar which would take land from the then Poplar Borough Council and develop it on a joint basis. The council's attitude was "No. This is public land, we shall develop it ourselves." But the council was not going to do that for five or ten years. That sort of attitude has damned East London and is still damning it over the development of dockland. This includes the reluctance to bring in private sector developments with all their benefits. I think that there should be mixed development, public and private, for social reasons.
There should be mixed development for cash reasons also because, as I have said, these vast sums of money will not be found by the Treasury. The Minister will not today pledge considerable sums of money over a long period, because he cannot do it—it simply is not there in the present economic situation. But I believe that a lot of money would be forthcoming in a mixed development.
I believe that the State's money should go to the infrastructure of dockland—for example, filling in the empty docks, supplying the drainage and the piling, and building a proper network of roads. The right hon. Member for Bermondsey mentioned Downtown. It is the same with the islanders of the Isle of Dogs. To get to many of these parts of dockland is almost impossible by public transport and difficult by road.
I believe that the Labour Party is thinking of moving its headquarters from Smith Square to Walworth, which is not all that difficult to get to. Yet one of the arguments against the move there is that it is too difficult to get to Walworth, although it is just across the river, turning left and going a bit south. But it is exceedingly difficult to have easy access to the dockland area, and we shall not get the economic regeneration of that area without easy road access.
There is the question of priorities in deciding where State money should be spent—for example, on the Fleet Line or the River Line. It is an imaginative concept, but I believe that if the River Line is built, it will be used essentially by passenger and not freight traffic. What that part of London needs, if small businesses are to be started and economic


activity regenerated, is good road communications that will take freight, not passenger traffic.
Therefore, if there is there a question of priorities—and we shall have to make a selection—my first priority would be a better road network in North-East and South-East London along the river banks before a rail system. In any partnership between public and private money, the public money should be spent on improving infrastructure so that development could take place.

Mr. Mellish: I do not want to overstate what the hon. Gentleman is saying, but surely he is arguing in effect that the State should build the roads, the drainage, the sewerage and the rest while private developers, when it is all done, come in, do what they want to do and make their profits. Is he really arguing that that is how such a development should be carried out'? That would be like the situation after the Great Fire of London, when private enterprise took all the pickings.

Mr. Baker: As the passage of time brings the right hon. Gentleman closer to my point of view on this matter, I look forward to hearing him say precisely what I am now saying in five years' time. Who else can build drainage, sewerage and so on but the Government? They only can provide the infrastructure that is needed. The right hon. Gentleman says that private enterprise will cream it all off. I draw his attention, however, to the scheme "Riverside", launched by the Tower Hamlets Council. It is a tripartite scheme. The council has land from the Port of London Authority and its own holdings. It has done a deal with the PLA and a development company. They are partners.
The area covers about 500 acres just east of St. Katharine's Dock. The partners will work with the local council which has, at long last acted as a catalyst in putting together a consortium. The council will provide the drainage, sewerage and the rest, while the development company will do the developing, and they will split the profits. What is wrong with that? It is infinitely better than sitting on one's hands and saying

"We will not do anything unless we can do it ourselves."
The right hon. Member for Bermondsey says that his area of Bermondsey and Southwark has about 540 acres of dockland. My advice to him and the local council would be to get on with those 540 acres through the sort of deal put together by Tower Hamlets Council. They should not wait for a new town development corporation, because that could not exist for two or three years. They should not hope for greater powers from the Docklands Joint Committee, because it will never agree. The best thing that the Bermondsey-Southwark area can do is to form a joint scheme of partnership between private and public money and get on with the job. That is my answer to the right hon. Gentleman, because that is what should be done.
The scale of the opportunity should not bemuse us into believing that there has to be a massive organisation and a massive scheme to develop it. I do not believe that we are living in an age when such vast resources can be made available. I should like to see the individual boroughs getting on as quickly as possible with schemes like "Riverside".
I believe that the Government's attitude is changing only sluggishly towards the London problem. The Government must accept that there is a massive work haemorrhage and that something must be done quickly. The first priority must be to remove the inhibitions on the growth and development of jobs. I should like to hear the Government announce the abolition of industrial development certificates and office development permits in this debate. The Minister may reply that they are hardly ever operated now, but the fact remains that there is still a certain atmosphere and climate inhibiting development.
In looking forward to this area being redeveloped over the next 20, or 30, or more years I do not want to see it become a vast dormitory town where people just live and commute on the Fleet Line to work in other parts of London. We have to find a way of regenerating economic activity in inner London, and I am convinced that the most effective way of doing so is to stimulate the growth and development of small businesses. We shall not see large factories being set up


in Tower Hamlets, Bermondsey and Southwark, not even with a better road structure, and not even if we improve the infrastructure on the lines I have suggested. That is not going to happen.
We shall be deluding ourselves if we think that vast industrial conglomerate activities in the East End will be built, because it will not happen. One has to create conditions of spontaneous growth—the conditions under which dockland first developed between 100 and 150 years ago—so that small businesses, such as warehousing, engineering operations, printing and service works of all kinds are attracted there. They are not attracted there today, because of the gloomy atmosphere of decay and depression.
I am advocating a greater sense of realism in the development of this vast area in East London. Great urgency is needed. First, there must be a commitment by the Government of certain funds for basic infrastructure which can be specifically directed to specific boroughs, and, secondly, the boroughs should be told to get on with their joint schemes as quickly as possible so that we do not find ourselves having to have another debate like this in 10 years' time.

4.59 p.m.

Mr. Arthur Blenkinsop: I intervene briefly because I was a member of the Sub-Committee which prepared this report. We are grateful to the hon. Member for Daventry (Mr. Jones) for the hard work he did as Chairman. I intervene also because I believe that, although the report now has some historic value, it is still of importance in relation not only to dockland but to other derelict areas in other towns and cities throughout the country.
I do not wholly agree with what the hon. Member for Daventry said about the treatment of capital development in new towns as against development in inner cities, but we should try to clarify our minds about the undoubted size of the commitment required not only by the dockland scheme but by comparable schemes which would be required in Liverpool or other big cities. We must consider what is practicable and what is not.
I agree with much of what the hon. Member for St. Marylebone (Mr. Baker) said about encouraging joint partnership

schemes between local authorities and private development, under suitable control. Many practical schemes have been worked out and I hope that they can go ahead.
I was therefore concerned at the proposal by the hon. Member for Daventry—although he was the Chairman of the Committee, he made it clear when he was speaking for himself—that the provision of capital should come from the resources of the new towns. That could be a dangerous proposal. New towns should not be regarded purely as competitors with the kind of redevelopment needed in the inner cities. I regard them as partners in a common enterprise. The new towns were devised originally to secure more humane living conditions in our big cities. They were meant not only to set new standards in greenfield sites but to encourage movement from the centres of population and industry in the older city areas so as to achieve better living standards and to attract some people back.
I agree that it is unrealistic to imagine, as my right hon. Friend the Member for Bermondsey (Mr. Mellish) apparently does, that we could attract back to these areas the old heavy industries which were established there for all kinds of historic reasons. It is not practical, and perhaps not even desirable, to seek to attract back the modern versions of those industries.
The change has come about not through the planners attracting everyone into the new towns and denuding the older areas. The attraction of the new towns has made a relatively small contribution. The bulk of the movement was due simply to the death of many of the old industries and partly to the difficulties of operating modern industry in those areas. Transport and accessibility were important questions. The original attraction for industry no longer exists in the same way.
However, there is a real possibility of a much larger development of small-scale industry than some people think. Some recent experiences in Greenwich, for instance, show that. Perhaps much more could be done to encourage that development. I doubt whether the abolition of industrial development certificates would make any difference to that situation.

Mr. John Cartwright: My hon. Friend provokes me by referring to the experience of Greenwich, which, I would claim, has an impressive record in introducing new small firms. If he spoke to those in Greenwich who are responsible for that operation, he would be told that the whole IDC system creates the sort of climate which makes it difficult to move in even small firms, which are not affected by IDC controls.

Mr. Blenkinsop: Our evidence did not bear that out. There have, of course, been changes in the IDC procedure, weakening it from the point of view of some of us in the North but to the benefit of areas like the London Docklands. It cannot be said that even such difficulties as might have existed two years ago exist today.
I hope that the Government will not conclude that it has to be one or the other—that the whole concept of the new towns should be choked to benefit the older areas. There must be a proper balance, but it is unfortunate that one arm of the operation, which involves the development of new towns and of improving standards in the older areas, has not been properly followed through.
As the London Docklands strategy plan shows, one of the first priorities in redevelopment is the improvement of living standards so that people again may choose to live there with a reasonable balance of choice. The great exodus has been due not necessarily to the machinations of the planners but to the conscious choice of people who got fed up with the available standards—not only in London but in other cities—and who exercised their choice with their feet.
Our report refers to mobility. Environmental standards must be vastly improved. Not only must we attract people back, but we must give them greater mobility. The people in the area must make most of the decisions, but I question the concentration of all the effort in regard to mobility on the Underground going from east to west—the very heavy capital expenditure inevitably involved in the Fleet Line extension. This matter will have to be considered carefully, on reasonably accurate estimates of cost.
However, I should have thought that a great deal could be done to improve mobility from north to south so as to

avoid the assumption that London is a single-centre city. After all, is not London a series of centres, and do we not want it to be a series of centres? May it not be important to link with the better standards of living the mobility that can be given by immediately improving north-south communications as well as examining east-west mobility?
I end with the obvious and important point of employment, emphasising that a great deal can still be done with small industrial developments. The rest of Britain has a great deal to learn from whatever development takes place in this part of London, because so many other areas face comparable problems, though not necessarily of the same size. We are eager to develop new opportunities for employment but do not imagine that we can necessarily attract back some of the large-scale industry that may have been there in the past.

5.11 p.m.

Mr. Timothy Raison: I agree with a number of points that the hon. Member for South Shields (Mr. Blenkinsop) made, and I shall return to one or two later.
It may seem a bit odd that I should be taking part in the debate. I was not a member of the Expenditure Committee, and I am not a London Member, but it is reasonable that outsiders should take part, for we are talking about our national capital, the inner city problem, which covers a number of areas other than London, and the allocation of national resources. As a taxpayer, I suppose that I have a kind of vested interest.
When I was shadowing the Department of the Environment, I became very interested in the subject of London dock-lands and spent some time trying to go round this, to me, surprisingly vast area. I made an effort to get to grips with what is a very complicated problem, and I emerged with the strong feeling that we could not simply allow the area to rot. When one visits the area one sees that it consists of different sorts of place and is not all one great big disused dockland. It has other land as well. One has the feeling that when industry has so nearly died there is a big risk that we shall create Pompeiis of the future, which would be intolerable.
I also had, and still have, the strong feeling that we shall not solve the problem by rhetoric. It is a good thing that we should declare our concern and commitment. We have all done that now, and need to move on to a more realistic view of what can be done and what may not be done. So far the debate has been good in that respect. My hon. Friend the Member for St. Marylebone (Mr. Baker) made a number of very pertinent and realistic points, as did other hon. Members.
We can see that the economic aspect is the heart of the whole problem. In the arguments about inner cities there has rightly been a shift of emphasis over the past decade. Ten years ago people talked very much in terms of bad housing, bad education and so on, which they seemed to see as the essence of the problem. I do not deny that such conditions exist and are serious problems, but we now have a clearer idea that we shall not cure all the social problems unless we can improve the economic heart of the places we are discussing. Therefore, one is bound to ask whether it is conceivable that we shall get a proper economic vitality back into the area, or whether the most that we can hope for is to provide a kind of subsidised propping-up so that conditions do not become too miserable and depressed.
We must recognise that it is a very difficult problem. When it thinks about setting up new factories, particularly the larger ones, industry has a preference for greenfield sites. It likes to go to places such as Milton Keynes, because it can have the size of factory it wishes with rather less bother than is involved in trying to carve out a factory in an existing city area. Transport is also a major problem. The truth is that the Milton Keyneses of this world are very well situated in terms of transport. Milton Keynes itself sits beside the M1 in the middle of England and has a major railway line running through it. Those are great advantages.
In trying to be realistic in thinking about what we can bring into the inner cities, we must approach the matter without a great harooch of dogma. We may want all forms of public transport. We must look carefully at the kind of transport that industry will want in such areas. If we start from the premise that economic

revival is the essence of the problem, we must make life tolerable for industry or encourage it rather than try to damp it down. I am therefore very suspicious of the GLC, which has a mania about transport and is wrong about transport in almost all respects, as far as I can see. I hope that ways can be devised to stop it imposing its dogmas on dockland.
The lorry is the crucial mode of transport. It is the lorry on which industry today depends. One can make stirring speeches about how all industrial traffic should be pushed back on to the railways, but everybody knows that that will not happen. We shall waste a great deal of time if we try to pursue an unattainable chimera.
We must also recognise that the people whom we want to attract into dockland and the people already living there, to whom we want to give an improved life, want to have motor cars. We should not allow puritanical dogma to stop people having something they want. The skilled working class—if I may categorise and generalise—want motor cars and roads on which they can drive them. It is a great mistake to try to shape policies which do not recognise those cardinal facts.
Therefore, as my hon. Friend the Member for St. Marylebone said, we must put the transport emphasis on the road system. One of the wiser recommendations of the Expenditure Committee was to call for a review of the public transport provision that was envisaged. The Committee said:
We recommend that studies should be made of alternative proposals for a long-term dockland public transport system based upon existing surface lines and rights of way.
I do not claim to know the best possible public transport provision for the area. It may well be that the Fleet Line extension, the River Line, is the right answer. I am not trying to dismiss it, but the hon. Member for South Shields was wise when he gave a warning. There is a serious risk of going for something that sounds splendid and nice but turns out to be so expensive that nothing happens. That would be a tragedy.
We must learn from the bitter experience of a number of public transport systems across the world. We have seen in Newcastle the creation of a system that will be very unprofitable. A few years ago there were high hopes for the


Great Bay transport system in San Francisco and the surrounding area, but it is now seen to be a costly luxury. We must be very careful about embarking on massive fixed-line public transport systems when the attraction and flexibility of the lorry, motor car and bus are so strong. Let us think very hard about transport and not mouth platitudes.
I think that we are all agreed that our objective is to find a new life for the old docks and perhaps to go on to find a more positive and useful purpose for the further end of dockland, which I suspect belongs to Newham, the area towards Beckton, where there are green fields, though they are about the dirtiest one could ever expect to see. However, they constitute a sort of greenfield site rather than the large series of holes of which the true dockland communities very much consist.
We need, first, a commitment to reviving the true dockland areas, and then we need to think very hard but perhaps not very hurriedly about what to do with the dirty green fields towards Beckton. The best use for them may be for recreation, for golf courses, small holdings and allotments where we can grow our own potatoes—which is quite a profitable and wise thing to do in these times. It may be that that is all we can hope for.
Equally, it may well be that there are more positive uses to which those green fields can be put. They could provide low-density housing, which would relieve the pressures which still exist in the inner areas. We are always hearing from inner London Members about how they wish to seize tracts of land in the outer London boroughs in order to house their own population. But the outer London boroughs are justified in asking about the large tracts of land that exist in areas such as Beckton. Of course services will be needed and drainage will have to be undertaken.

Mr. Spearing: Perhaps I can save the hon. Gentleman some time. There is a £4 million drainage plan in operation and the draft Beckton plan, which has been published for consultation, contains some of the facilities that the hon. Gentleman has suggested, together with eight plans for 8,000 new houses. The actuality has outrun the hon. Gentleman's suggestion.

Mr. Raison: I am grateful to the hon. Gentleman. But I have the feeling that plans and actualities are not always necessarily the same thing. But what I have suggested is a reasonable proposition, provided that people want to go and live there and provided that there is the money to build the houses.
Some hon. Members will probably have read the evidence of the Town and Country Planning Association, which rather wisely and in conformity with its ideals and traditions said that there was an opportunity for providing the low density garden-city type of housing that it has advocated over the years. That may well be the right answer. It may even be that these largish tracts of space which exist in the area provide some scope for the creation of new factories. If that is the case, well and good.
If our primary objective is the revitalising of the old dockland area, with the secondary objective of bringing these other areas into play, we have to ask ourselves what kinds of policies are likely to bring this about. The economic side is all-important. Probably the best thing that can be done to revitalise the economies of those areas is to have a national policy rather than a local or inelegant area-specified policy.
When I talk to smallish business men about what might encourage them to expand, they do not say that they want more subsidies and subventions or boards and committees and national enterprise boards and so on. What they want is to stop being pushed around at the present extent. They do not want to have unjust planning regulations which seem designed to stop them pursuing their trade; nor do they want more and more taxes which depress and demoralise them, or more and more seemingly well-intentioned legislation. They do not want to fill in more and more forms, questionnaires and census returns and all the other things which have smothered them in recent years. They simply want to be able to get on with the job of producing and making some kind of reasonable profit.
We should help business in those areas and in the rest of the country if we tried to produce rather more sensible policies in this respect than we have at the moment. We must encourage entrepreneurs. This is the kind of area in


which in a sensible society the entrepreneur would have full run. It is exactly the sort of situation where the entrepreneur has a major contribution to make to the modern economy. If we simply go on making life difficult for them, we cannot hope to expect them to do what I believe they want to do.
One must also have a sensible land policy. I do not want to spend a lot of time talking about the Community Land Act.

Mr. Michael Latham: My hon. Friend does not need to.

Mr. Raison: My hon. Friend says we do not need to. Some people would ask "What is the Community Land Act?" Nevertheless, it exists. During the passage of that Act, Opposition Members said time and time again that it would do absolutely nothing to benefit the inner cities. The Government pooh-poohed or ignored that view, but we were absolutely right.
Opposition Members perhaps underestimated the positive damage that the Community Land Act would do to the development of our inner cities. What the Act has done is to make the nationalised industries feel that there is no point in their selling the land on which they sit. Everyone knows that when we talk of dockland land we are not basically talking about land in private ownership. We are talking about land in the ownership of the Port of London Authority and the Gas Corporation. I should add land in the ownership of the local authorities. All those bodies have a long tradition of hoarding land, or believing that one day something will turn up which will make it valuable.
Such bodies are remarkably bad at selling land anyway. The Community Land Act has made that situation worse, because it leads the Gas Board and the PLA to believe that there is no profit in their selling land and, therefore, they do not bother. That is a hard fact that was repeatedly prophesied during the passage of the Act, and it is now seen to be perfectly true.
Another important point about land is that the system of valuation is cockeyed. We have reached a stage where it is cheaper to buy land in the greenfield sites around the new towns than it is in

the areas to which no one wants to go in the big cities. The reason is a little hard to fathom. It is partly a matter of expectations and the belief that one day land in the cities will suddenly be worth a lot. After all, it appears that the district valuers, who have to approve the sale of land by public authorities, take a too optimisitic view.
I sometimes think that we could do more for dockland, and the very large tracts of unused land in Liverpool, if we had a big auction and "flogged" the land. We might then achieve something, because people would buy it because they wanted to use it for some purpose rather than letting the land remain unused, as is the case at present.

Mr. Ian Mikardo: The hon. Gentleman's contention that the Community Land Act has the effect of inducing authorities like the PLA to hold on to land is not borne out by the fact that, during the operation of the Community Land Act, the PLA sold a considerable parcel of land through one of its subsidiary organisations to the Tower Hamlets Borough Council, with beneficial results to both sides.

Mr. Raison: If the hon. Gentleman says that, I shall not quarrel with him. But is the hon. Gentleman sure that this was since the Community Land Act came into being?

Mr. Mikardo: Yes.

Mr. Raison: That may be an instance, but I can assure the hon. Gentleman that the employees of public corporations say that the Community Land Act is a deterrent to selling. It is a bit of a red herring, because many nationalised industries, which have had plans to sell off land in order to meet their debts and deficits, have been driven to a state of considerable despondency by the passage of the Community Land Act. We should let the market operate more than it does. It need not be totally laissez-faire, but we need an injection in the market.
No one thinks that the whole problem of dockland can be left to the market system and to private enterprise. There has to be some kind of guiding central management organisation. I do not believe that the present joint committee has got it right. I accept that the number of local authorities is enormous and almost all of


them have powerful and direct interests in the land in question. One has to have a system that will allow them to have a considerable say in all this.
Nevertheless, I believe—and it is the experience of those people professionally engaged in developing dockland—that the present structure is inadequate. There has been a discussion about whether one should establish a sort of a new town development corporation. Even if that had been the right answer originally, it is now a little too late to try to jump into that. Even so, it should be possible to develop some form of two-tier board. The top tier would be the board on which the local authority and the Department of the Environment were represented. They are providing the money and it is their land, so they should have an important say in setting up the strategic decisions that should govern the development.
Underneath that tier one needs an executive board that will have considerably greater powers than exist now because, after all, under the present set up it is fair to say that if any local authority wishes to put a veto on something, it is able to do so, and it is also fair to say that there is a good deal of referring back by the people who run the operation to the local authorities.
I do not claim to have a precise blueprint of how this will be done. I do not claim to be an expert in all these details, but I believe—and I am sure that this is borne out by many who have looked closely at the problem—that one must have a stronger executive organisation than now exists. We must be prepared to say "This is the framework within which you will work, but you must have a chance to get on with the job of delivering the goods".
Although the hon. Member for Newham, South (Mr. Spearing) is waving that orange document with great vigour and energy, and although there is a lot to be said for the London Docklands Strategic Plan—I am not quarrelling with the shape of the plan—I do not believe that the executive powers are strong enough as things are constituted now, and I have a horrible feeling that history will prove me to be right.
I move on to the next difficult question of who will pay for all this. There

are those who believe that London could pay for the whole thing, particularly if the Fleet Line extension were dropped out of the scheme. That is probably too optimistic. As a taxpayer elsewhere I should be happy if London could pay for the whole thing, but the degree of reallocation of resources within the London totality that would be required to bring this about is probably too great, and this is a matter partly of the hard, practical political side of all this. There is a big job and a lot of expenditure to be undertaken to bring all this about. Therefore, it seems that Government investment will be essential if the scheme is to work.
I am attracted by and sympathetic to the ideas advanced by my hon. Friend the Member for Daventry (Mr. Jones) about whether it would be possible to make better use than we do now of the money that is at present locked up in the new towns. The new towns hold tremendous commercial assets. They have certain principles, such as that they will not sell freeholds, and so on. I do not think that those principles are necessary. I see no reason why commercial freeholds should not be sold in the new towns if that is the right commercial thing to do.
I do not want to tell the new towns how to manage their assets. I do not claim to know, but the possibility of selling freeholds and of making more out of these great public assets should be explored very hard, and if we could make more out of them, I should be happy to see a good slice of that directed towards this revitalising of London's dockland that we all believe to be deeply necessary and to be an opportunity that it would be tragic to miss.

5.34 p.m.

Mr. John Cartwright: I ought to declare an interest as I am a member of the original Docklands Joint Committee. On looking back, I am not sure that if I had that time over again I would go for the form of organisation that we then supported. Perhaps because I was then involved in local government I took a different view from that taken by my right hon. Friend the Member for Bermondsey (Mr. Mellish) who, as he indicated today, is passionately in favour of a development corporation approach.
On looking back, I am not sure that we should not have done better had we had a development corporation. I think that my right hon. Friend is right in arguing that we should have had more resources had we had a development corporation, rather than going through the somewhat involved and tortuous democratic process of having five local authorities and the GLC involved in this joint committee. I think it is fair to say that we would not have had quite same degree of internecine warfare between the various members of the joint committee that we have had over the history of this development.
When my right hon. Friend was speaking, I was reminded of the original consultants' proposals. I remember the original 26 options that were put up, to our somewhat surprised eyes, way back in the early 1970s. The proposals contained some marvellous ideas. Industrial land was to be turned into open space, and open space was to be turned into industrial land, which no doubt would have meant work for working planners, but it did not seem a practical approach. There was the concept of an East London Safari Park. No doubt that would have brought joy to my hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo), but it did not seem a practical solution to the problems of East London.
I look at this matter very much with the eyes of my own local authority, which has a substantial area within the docklands development area—a piece of land on which, sadly, nothing very much is happening, and on which nothing is likely to happen as part of the docklands development. In addition, it is a borough that is very much affected by what happens in the rest of docklands and therefore I support the case made by the Government in para. 4 of their observations where they say:
Docklands is not self-contained, nor should it be: its development is part of the development of the five boroughs in which it lies".
That is an important point to bear in mind.
I look at this from the point of view of my experience at Thamesmead, because all the presentational razmataz that my right hon. Friend the Member for Bermondsey was recalling about the original dockland concept was present when Thamesmead was launched. It was

to be a great city of the twenty-first century for 60,000 people, rising Phoenix-like from the mud. Sadly, it has got stuck in the mud in recent times. The time scale has drifted in that case. It started in the middle 1960s, and it is stretching into the late 1980s and early 1990s. There is some problem of the relationship between the GLC and the two local boroughs, the two local education authorities, and so on, with all the difficulties that that involves.
The hon. Member for St. Marylebone (Mr. Baker) made a point about the need for adequate private housing to get a housing balance in dockland. That is something that we had very much in mind when Thamesmead was launched. The original Thamesmead concept was 65 per cent. public housing and 35 per cent. private housing, but it is a sad fact of life that the 35 per cent. private housing has been difficult to get moving at all. Despite houses being offered for sale at favourable prices, and despite land being made available for private development at favourable prices, we have not seen a tremendous burst of enthusiasm for buying homes at Thamesmead, and my guess is that the same experience might be found in dockland.
I was a little unhappy at seeing the Government's reaction on the basis of making available adequate resources. In para. 9 of their observations they make it clear that there is to be no special form of support, but within the normal form of support the Government believe that
important progress can be made piece by piece and phase by phase within the framework of the overall strategy.
Our experience of Thamesmead is that that is an excuse for the time scale lengthening out and for the whole drive, energy and purpose of the original concept being lost. In the case of Thames-mead, it has meant the whole original dream becoming something of a nightmare. Instead of being a new town, it has developed into nothing more than a sprawl of council estates.
New industry is crucial to the development of dockland and renewing the whole of life in the dockland area. The Greenwich example is fairly well known. In a ten-year period, it lost 20,000 jobs in manufacturing industry. On the other hand, it has fought hard to try to bring


jobs back to the area. A point has been made about the need to bring in more new small firms. The record of Greenwich over the past three years is one of attracting 120 new firms into the area. About £40 million of private capital has been invested.
That is an indication of what can be done by a local authority determined to hang on to its manufacturing base and to provide balanced employment for those it represents. It is a sad fact that the whole area of Greenwich within the dockland area is earmarked for industry, yet the greater part is totally sterilised because the gas board is grimly hanging on to 210 acres of it. The gas board is nothing to do with the Community Land Act. At some stage North Sea gas will run out. Therefore, the board may need a gas-making potential in the London area and it must hang on to its land just in case in 30 or 40 years it is needed for gas production.
But that is a tremendous blow to us because the Blackwall peninsula is an ideal industrial site, with tremendous development potential for industrial undertakings. It has good access to transport. The Blackwall Tunnel southern approach to the motorway runs through it. It has easy access to the river and is well away from housing. It is a natural industrial site on which could be replaced many thousands of the jobs which have been lost to the area. I therefore hope that the gas board's case for sterilising the land for generations will be severely tested.
I agree with hon. Members who have indicated that the success of industrial development in the docklands area depends to a large extent on a genuine relaxation of industrial development certificate control. I accept that the Government have moved some way in that direction, but if we are to change the climate of opinion, if we are to persuade industrialists that there is a home for industry, even if it is for small industries, in London, we must make a dramatic relaxation in IDC control as a means of making it clear that the climate has changed.
We must make it possible for those involved to be able to advertise the industrial potential of the docklands area. It

is absolutely crackers that London buses carry advertisements for Peterborough, for example, and we advertise throughout London the charms of Cumberland, Scotland, and virtually every other industrial location, but are denied the right to advertise the industrial development potential of the docklands. Provision in this respect is made in the general powers Bill of the GLC, and I hope that it will receive support from hon. Members on both sides of the House.
I welcome what the Expenditure Committee and the Government have said about the need for industrial training and retraining in the docklands area. It is clear that skills are in short supply, and this is a limiting factor in industrial development, but sometimes we ignore the results of the closure of firms. Some of the firms which have left were among the best trainers of young labour in the area. In the constituency of my hon. Friend the Member for Greenwich (Mr. Barnett) Harveys, which had a tremendous apprenticeship and training record, is very much depleted and facing virtually complete closure. In my constituency, at Woolwich Arsenal, there is one of the best appointed industrial apprenticeship schools that one can find for many miles. It is threatened by the closure of the workshops at Woolwich Arsenal.
Closures of that sort remove opportunities for industrial training of young people. I accept that the Government's skillcentres are being developed. My hon. Friend the Member for Greenwich will recall that he and I have been fighting for the Deptford skillcentre since 1968 when we were first promised it. It is now more firmly on the horizon, but it is still some way off. Skillcentre provision is to be made at Kidbrooke later this year and at Charlton next year. I welcome that. But all we are doing is seeking to replace the potential for training of many firms which have left the area.
I turn briefly to the question of transport. I support hon. Members who have said that the River Line is the key to docklands development. It is important as a demonstration of public confidence in docklands development as well as a necessary basis for that development. I hope that the alignment to be seriously examined will be the southern alignment, because it provides an important link


between Woolwich Arsenal and Thames-mead and a link between Thamesmead new town and its basic town centre at Woolwich.
Hon. Members opposite have spoken about the possibility of alternative bus services. My constituents in Thamesmead have minimal bus services. On Sundays they have no bus service at all.
The River Line could provide a major link between Thamesmead and Woolwich and between Woolwich, at a strategic centre for shops and offices, and the rest of Docklands. It could also ease congestion on the North Kent railway line, on which the trains are chronically overcrowded. As my right hon. Friend the Member for Bermondsey (Mr. Mellish) said, it might give people in South-East London a Tube service of the type which is taken for granted by people situated on the more favoured side of the river.
I wish to speak briefly about road schemes. I am less enthusiastic about one of the major road schemes proposed in the Dockland study, namely, the East London river crossing. This is a proposal to build another tunnel at Thamesmead and to provide a motorway link with the A2. I wish to declare a parochial interest: the motorway proposal would eliminate about 200 homes, virtually all of them in my constituency. It would plough through attractive public space at Rockliffe Gardens and Oxleas Woods. Sadly, it would drive a wedge through the middle of the last working farm in my constituency. I should be sorry to see that cut in two.
All the benefits from the East London river crossing would go to people on the north side of the river. All the disadvantages, as the Docklands Joint Committee accepted, would be borne by my constituents through whose homes the road would run. It is fair to say that it would involve a substantial attraction of extra traffic through the East London river crossing, particularly if tolls for the Dartford Tunnel go on increasing at their recent rate.
What worries me most of all about this and other road schemes in the study is the degree of blight which affects an area when schemes are earmarked for post-1986, as is the case with the East London river crossing. We are told that the completion period from start to finish is 11

years. If we are talking about blighting an area for that sort of period, and if schemes are stopped dead simply because 10 years from now somebody may build a road, which may take another 11 years to complete, at a cost, on 1975 figures, of £87 million, while I am in favour of strategic planning, there must be a genuine and realistic forward parameter for the length of time that such plans can remain in being.
The people we represent who live in and around dockland are not all that impressed by strategic plans, by strategy documents, by glossy brochures and by paper produced in large quantities since this operation started. They take the view that that is no substitute for genuine, effective development on the ground. I support those who have said that we shall not get that development without a much greater sense of urgency and much more evidence of commitment by the Government.

5.49 p.m.

Mr. Michael Latham: I agree with virtually everything that the hon. Member for Woolwich, East (Mr. Cartwright) has said. Much of it reflected the motive which lay behind my thinking when I served on the Select Committee, which I still do. There are two reasons for my intervention: first, because I serve on the Select Committee; and, secondly, because for six years I was, with my hon. Friend the Member for Hampstead (Mr. Finsberg), a member of the GLC Housing Committee and, for three years, an elected member of the Westminster City Council. I was vaguely involved in London local government for six years.
When I was involved in London local government and during the time that I served on the Select Committee I was impressed by the feeling that a sea change was taking place in the thinking about London's planning. When I became a member of the GLC in 1967, there was, and perhaps still is, an expanded towns committee, whose job was to export people from London.
The whole thinking of the officials was still very much along the lines of that in the Abercrombie Report. This document of 1944 said that things would be much better after the war and that people should be moved out of the terrible areas of inner London into the green fields of


England. That was a very noble aim, but, like so many planners' aims, the reality proved very different from what was intended at the time.
It was not just London—the same problem occurred in many of the other great cities. Liverpool was another example of the inner city dying and the suburbs deteriorating and being vandalised. That does not make any sense. It is essential to turn back the tide of Abercrombie thinking when dealing with the docklands. We are simply spilling people all over the country and killing London, Liverpool, Manchester, Glasgow and other big cities. We must do something about that now. But the problem is that we are still thinking in the old-fashioned terms of Abercrombie while the world is passing us by.
During my service on the Committee, when we were conducting this inquiry I was depressed by the atmosphere of the political negotiations in London on this matter. This is not a party point. I felt, as did my colleagues on the committee, as we listened to witnesses, that they were all finessing for position. Each was concerned with his own interests and with making sure that whatever came out of the document would defend those interests. There was no wide overall view.
My right hon. Friend the Member for Worcester (Mr. Walker) and my right hon. and learned Friend the Member for Hexham (Mr. Rippon) made it clear that in retrospect they felt that it would have been better to have had a development corporation. But, as the right hon. Member for Bermondsey (Mr. Mellish) said, that is now water under the bridge. There is not going to be a development corporation and we must try to work within the existing system.
I asked several witnesses whether it was too late to set up a development corporation and to turn back the tide. But the more I listened to the witnesses describing all the difficulties that would follow, including getting a Hybrid Bill through the House, a Bill which would be bitterly contested, and the fact that the GLC would petition, the more convinced I became that turning back the tide would mean fighting a losing battle.

It was clear that we would have to work within the existing situation.
Let us look at the report of the evidence of the South-East Economic Planning Committee, the representatives of which said, in undoubtedly the most brutal statement that I have read:
Firstly, there is not in existence at the moment any body which can take and carry decisions which may be unpopular in one or more of the boroughs or with the GLC.
I then asked how it would be possible to commend such a recommendation to Parliament—to set up a development corporation to take unpopular and difficult decisions. The Chairman, Lord Porchester, replied:
The fact is that the new towns, including the first generation around Greater London, faced this very problem.
I pointed out that 15,000 people were already living in dockland. He replied:
There are 30,000 in Hemel Hempstead. A new town corporation was imposed upon that community.
The argument that a development corporation would have been impossible to achieve in dockland was wrong. Nevertheless, the decision has been taken and we must live with it.
I wish to say a word about private financing. During the discussions Trammell Crow was still interested in the scheme, and that was about the only bit of private finance that was interested. Therefore, I was particularly concerned about the evidence from the Port of London Authority—one of the main landowners in the area. I asked a number of questions of PLA witnesses about the involvement of private finance. The fact is that it is possible to do a deal between the developer, the landowner and the local authority by which the infrastructure is provided by the developer in his costs. I said:
In effect they are waving a stick over your head and saying, If you do not give us some proportion of the development profit by way of infrastructure contributions we will not grant planning permission'?
The witness replied:
That is how one gets planning gains in that context.
I then asked if it were possible to do it if the will were there, and whether there was a lot of interest being shown by


developers, such as Trammell Crow, in this project. Mr. Hughes replied:
Not since the publication of the White Paper on land, but people are still coming to us with ideas which they would like to see carried out in the docklands area.
I asked him:
In view of the fact that there is total bureaucratic control over the exercise, because the Docklands Joint Committee are working on it with the DOE, do you feel this means that developers who may come along with perfectly workable schemes will be prevented from getting on with them because they will not get planning permission since their schemes are in advance of the long-term plan which will not appear until next year?
He replied:
That is probably the case. We have not had people coming forward with plans in the last few months, whereas in the past we have had developers coming along full of ideas, but it is difficult to give all the reasons; we do not know them.
The thing that comes out of the testimony of the PLA—the largest landowner in dockland—is that there was a possibility of private investment, but that private investment will only go there if there is the political will. In listening to the replies of the witnesses I did not get the impression that the political will existed. The elected leaders of London now have our report. I hope that they will get on and do something about it.

5.57 p.m.

Mr. Nigel Spearing: Of the designated dockland area, no less than half is entirely within my constituency. In fact, two-thirds of my constituency is within the dockland area. Therefore my constituents are particularly affected by this report and these developments, more so than those of any other hon. Members.
The hon. Member for Melton (Mr. Latham) mentioned the plans of the GLC and the Abercrombie Report. I think that the Barlow Report before the war set the ball rolling. I was a co-opted member of the GLC planning committee and my main objection was to trend planning. Planners plan for all sorts of objectives. In the late 1960s the planners were planning for existing trends, greasing the skids for what was happening economically at that time. That is not always the best thing to do. Sometimes it is better to plan to change the economic gravity of the time.
The hon. Member for Melton also mentioned Hemel Hempstead. It may be true that Hemel Hempstead had 30,000 people in a single centre. The docklands have 5,000 people who are, related to many different places separated by the river and by industrial areas. Therefore, it is not right to compare a semi-green-fields situation in Hemel Hempstead with areas around dockland. Physically and historically the situations are very different.
We must look at this matter in three distinct sections. First, there are the physical and economic factors affecting the environment, and we must examine the essential nature of the present situation, secondly, there was the institutional and statutory framework; and, thirdly, there is the economic and social future. All these factors are bound up with money. Later in my remarks I shall mention some matters that seem to have escaped the attention of the Department of the Environment.
I am a little concerned that nobody so far has mentioned the Port of London as such. It has been mentioned almost in passing in connection with a surplus of land, as though its docks were no longer in operation. But the essence of the problem is that the land is related to the era of nineteenth-century port development and the development of port-related industries. I refer to areas such as those mentioned by my right hon. Friend the Member for Bermondsey (Mr. Mellish), who used the phrase "down-the-end areas".

Mr. Mellish: The phrase I used was "downtown".

Mr. Spearing: I was referring to areas along the river bank related to urban centres such as Poplar, West Ham, Greenwich and so on.
The Port of London can be compared with the chest in the sense that it is an area of interchange between land and water rather than dealing, as does the chest, with air and blood. So far, this debate has concentrated on the blood and not very much on the air. I wish to emphasise that the Port of London has a lot of life left in it yet.
My hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo)


is concerned with the area around the West India Docks, which are maintained in operation and which work up river. I wish to see similar activity in the Royal Docks in my constituency. The essence of the matter is that the Port of London may have changed its nature, but it is still there. The business of East London, apart from basic manufacture and production, engineering and so on, is transport—namely, railways, roads and the port. Transport is our business, and I hope that it will remain our business, because London is still the largest port in the United Kingdom.
With the onset of new techniques, such as BACAT, Sea Bee and barges which can travel from Tower Hamlets right up the River Rhine, I hope that we shall reach a stage at which the port can remain stable and will decline no further—for there has certainly been decline. In the past 10 years a total of 15,000 jobs have been lost in my constituency. We are suffering redundancies in ship repairing, and we in the borough of Newham also have a housing problem.
I submit that the Government's response in paragraph 5 of Cmnd. 6193 is wrong. It there says:
The Government … agrees with their conclusion that Docklands employment problems are symptomatic of a wider structural change taking place in London as a whole".
Although many things happening in London as a whole are exaggerated in dockland, I believe that it is the changes in the port and in port-related industries that have caused problems in East London. For this reason I hope that the Minister will agree that we need additional resources in the area. Therefore, I take issue with the Government and with their White Paper response.
Some hon. Members have cast doubts on the ability of the Docklands Joint Committee to fulfil the objectives that are common to all sides. Some have looked with nostalgia at the opportunities for a development-style corporation. I believe that this structure is the only one that will work. Urban centres related to dockland areas are way off the river and off the flood plain, and there are difficulties in east-west communications between the population. Therefore, we have a succession of garden back areas joined together by the river in the middle.
Co-operation among the boroughs has been remarkable because, for example, they have pooled their planning powers. Planning applications inside the dockland area are not now dealt with by the boroughs. They are remitted by the boroughs to the Docklands Joint Committee. A total of 114 applications have been dealt with and 1 million square feet of industrial space has been approved.
Furthermore, where a scheme receives a great deal of rate revenues the increase in the rate revenue is to be distributed by an internal scheme among the boroughs. This tends to avoid some of the internal rivalries that may be thought to be inherent among local authorities in adjacent areas. That is to the credit of the local authorities.
The authorities have already adopted Government recommendations and the Government have appointed many representatives from outside. For example, representatives from the City, and a chairman of a new town development corporation take part in the deliberations of the Docklands Joint Committee. Furthermore, the TUC is also represented. The committee acts more effectively than any other rival organisation.
Doubt has been cast on the action already taken by the Docklands Joint Committee. I believe that the committee has acted as speedily as it could in the circumstances. The hon. Member for St. Marylebone (Mr. Baker) said that work on land drainage, industrial use and back-fill had not started. My information is that the work has begun. An imaginative riverside scheme at Tower Hamlets has been agreed and it is fully in accord with the strategic plan produced by the Docklands Joint Committee. It is not thought to be disadvantageous to the London boroughs, but is an acquisition in the area, as a recent television programme suggested.
A sum of £4·6 million from the Thames Water Authority was allocated for Beckton Marshes in regard to sewers and all the rest of it. Furthermore, by the end of the year 367 houses will be erected in Beckton's "dirty green fields", as they were called by the hon. Member for Aylesbury (Mr. Raison). I would not refer to the area in that way. It is an imaginative scheme and when completed there will be 8,000 dwellings on that land,


2,220 of which will be either co-operatively or privately owned. In other words, there will be a mix of development.

Mr. Michael Latham: The hon. Gentleman surely agrees that these matters move extremely slowly. I remember the time when my hon. Friend the Member for Hampstead (Mr. Finsberg) and I served on the Greater London Council Housing Committee and discussed these plans. That was in 1968—nine years ago.

Mr. Spearing: As the hon. Gentleman said, there has been a delay, but it has not been the fault of the Docklands Joint Committee. The problem related to who should pay for draining the land. There has been a typically British compromise. Far from delaying the matters, the GLC stepped in and said that it would guarantee the orders for machinery, and in that way the scheme went ahead more speedily than otherwise would have happened. That is one problem that has now been solved. It was to some extent a disagreement between the borough and the GLC and, happily, it has now been resolved.
I turn to the problem of transport. I have a reputation in this House of not being a friend of new roads. I am not necessarily a friend of new large motorways to serve the dockland, but I am in favour of well sited relatively narrow roads without inter-sections to provide new routes to the docklands. That does not necessarily require large motorway standards. We must aim for routes that are not deleterious to the environment, but at the same time we must try to provide good through roads.
I suggest that that particularly applies to the link between the East Cross Route and Leystonstone, where I understand many houses are standing idle, vacant and ready to be demolished, and where there may be a possibility of a road scheme. I am referring not to vast motorways but to through roads to improve the environment. The same applies to the expansion of the Roding Valley route southwards to the Woolwich Ferry.
Mention has been made of the Fleet Line. There are other lines in dockland that are equally important. In my constituency the North Woolwich to Tottenham line has recently had its timetable revised by British Rail, and we are all thankful for that. That line could provide even better communciations than it does.
The most important point concerning industry—which I shall not mention because the subject has already been well covered by my hon. Friend the Member for Woolwich, East (Mr. Cartwright)—is that the dockland area is really part of the industrial and, travel-to-work area that stretches from Tilbury to Aldgate East and does not go much further west. The area is parallel to the Thames from London to Tilbury to Southend north of the River and along the North Kent line on the south side. Access to rail routes making a good journey-to-work area east to west is of paramount importance. This is where the Government's forthcoming White Paper on transport will be important.
So far the Government have not shown much realisation of the importance of transport for inner urban areas. But it is vital if they are not to remain as they are but to be rehabilitated. There must be proper transport services. The White Paper must take account of this and of not only the physical presence of the services, but the fares charged relative to the cost of a private car. That will be of great significance, particularly north of the Thames wehere over half of my constituents still do not own cars, do not wish to do so or, in many cases, cannot afford to do so. Therefore, public transport on the east-west line from Barking to Tilbury will be of great significance to the success of the docklands.
I now come to my last point. It will be longer than the others, but it is worth-while because it is concerned with money and resources, and they are the nub of this debate. The Government's response on finance to the Select Committee was disappointing. The Committee had said that the Department of the Environment should give specific details of the level of public expenditure commitment to dockland and that the Government should state their intention about providing financial support. That was contained in Recommendations 1 and 2 by the Select Committee. The Government's response was contained in paragraph 9 of their general observations. They said:
Developments in Docklands will be eligible for the normal forms of Government financial support to transport, housing and other purposes. The Government has no plans for special forms of support over and beyond these.
On the face of it, that is a disappointing response. It means that there is no


special form of grant and no additional funds—no dockland development fund as such.
But what the Government said—as the Minister said when we discussed the strategy for the South-East in Standing Committee—is that there will be support for extra housing, transport and other purposes in so far as they are to be located in dockland. Therefore, the door was not entirely shut. The response was that there would be only the normal means of support available, but possibly to an abnormal extent.
The Government have opened a chink in the door. They have said that they will be using existing channels and not new ones. We say that if the Government are to use existing channels, they must put more finance down them. I hope that the Minister will go further down that road tonight than in the past.
The Minister knows that there is a possibility here, because I have raised with him in Committee a point related to the interim report on the development of the Strategic Plan for the South-East which was published in February 1976. We can read in it something that might almost have come from the time when the hon. Member for Melton was on the GLC. It recognises the development of:
a limited number of major growth areas at varying distances from London, offering a wide choice of growth locations and using existing or planned urban settlements as bases for growth. Those closest to London would contribute to the planned development of the London metropolitan region and provide for workers and jobs unlikely to move over long distances. Those furthest from London would develop into relatively self-contained 'city regions'.
That was a year ago, although I know that the Government have not necessarily accepted the report.
One cannot quote maps but it contains a map which indicates that there would be a medium growth in the South-East, the Medway, and North in Kent, and major growth in South Essex.
If the Government are willing to underwrite the development, the resources must be available. My right hon. Friend the then Minister for Planning and Local Government agreed with me when answering a Question recently that surely he would have to balance the money going into expanding and new towns and

the amount reserved for the urban areas. He said:
I agree that what we need is a proper assessment of whether we are using resources wisely in the inner cities as against the new towns, which I take to be my hon. Friend's point."—[Official Report, 5th November 1975; Vol. 899, c. 382.]
I understand there will be £200 million to £300 million available for the next three years. That was why I intervened earlier during the speech of the hon. Member for St. Marylebone. If money is available and if funds are to be put into the new expanded areas in the South-East, the funds can be put into the docklands instead.
Moreover, some of the hon. Members who represent those expanded areas want that to happen. During the Committee in which the Minister made his first appearance as a Minister the hon. Members for Folkestone and Hythe (Mr. Costain) and Ashford (Mr. Speed) agreed that they did not want development of new towns between their constituencies. During the Committee on Dock Work Regulation Bill the hon. Member for Eastleigh (Mr. Price) backed me, saying that such development was wanted in London and that it was not wanted in Eastleigh because there were already many people in that area. So there is a bipartisan view on this matter.
I hope that there will be a change in the Government's thinking. I know that a review is now going on and perhaps it will include the curious proposals that were an overflow of trend planning and rethinking in the late 1960s referred to by the hon. Member for Melton. The resuscitation of old town centres and areas of nineteenth century industry and growth is a world-wide problem. It is a problem recognised around the world—the Minister and some other hon. Members went to a conference in Canada on this matter.
We have here an opportunity in London and the South-East to put money into docklands, money that I have shown to be available. It would not be to the detriment of the development areas and the constituency represented by the chairman of the Expenditure Committee or even to the detriment of areas of Wales that now require work to replace the steel works closures. We can do this within the allocation for South-East England.
I do not think that the people of Milton Keynes would necessarily begrudge


losing expansion there to achieve prosperity in docklands. Milton Keynes is a pleasant place to live in already, although there is not much public transport because it is difficult to organise. I hope that the Government will now say "Yes, these resources are available. As a result of our reviews, we shall channel them into the dockland areas at the rate of £100 million to £200 million a year."

6.19 p.m.

Mr. Ian Mikardo: My hon. Friend the Member for Newham, South (Mr. Spearing) declared his interest by saying, quite rightly, that a little more than half of the area of land covered by the dockland development scheme is in the borough of Newham, a part of which he represents with so much dedication and distinction that we all admire him constantly. I declare my interest by saying that more than nearly half the people who live in the area covered by the dockland scheme—some 26,000 out of 58,000 people in the five boroughs—live in Tower Hamlets, a part of which I have the honour to represent, though with less distinction than my hon. Friend does his parish.
It has always seemed to me that a basic weakness of all the talk that has gone on about docklands from the very first days is that there has been considerable discussion about the land involved but very little about the people who live in the area.
These 26,000 people are a closely-knit community with a tradition of the sort of neighbourliness which people of my age experienced in their youth, wherever they lived, but which has tended to disappear in the suburbs and remains only in villages and East London. They are people with minds of their own. I am told that one Opposition Member spoke with a certain degree of contempt about the people living in the area, but I do not pay much attention to public school Tories expressing contempt for large numbers of their fellow citizens.

Mr. Arthur Jones: The hon. Gentleman is making a quite serious allegation. As only a few hon. Members on this side have spoken, the implication must be that he is referring to one of us. Perhaps he would be kind enough to name the individual.

Mr. Mikardo: We can look at the Official Report tomorrow. Then we shall all know.
It is because there is this densely-congested community, with a lot of people in a very small area and with most of the families having been there for generations, that we cannot simply foist things on them without taking their views into account. No, R. Travers Morgan and Partners, distinguished consultants though they are, and not even a Select Committee of this House, distinguished in its membership and assiduous in the fulfilment of its task as it was, can decide just like that on something which will affect the welfare of these 26,000 people without stopping to think what their views might be.
Reference has been made to the Travers Morgan study, with its beautiful options and its lovely coloured maps. The initial 26 schemes were whittled down to 18 and then to five. Everyone looked at those five and agreed that none was any good. We chucked them out. Hundreds of thousands of pounds and, more important, a couple of years' work were lost in the process. This firm of consultants is a skilled organisation of great distinction, but it made one big mistake. It talked to everyone in sight, but it did not talk to the people who live in the area. The consultants did not try to learn their views.
We had the pretty idea of producing schemes and then allowing for a process of consultation with the chaps. The chaps were to be presented not with a fait accompli but rather with a choice of several faits accompli—though their views would be taken into account. That is not the way to do it.
Planners do not always know best. Sometimes the chaps on the ground know better than the planners. I venture to repeat a part of the evidence that I gave to the Select Committee. It goes back 10 years or more to the trend planning of the GLC and even before that to the planning of the LCC.
Some people living on the Isle of Dogs objected to the fact that, because there was no secondary school on the island, their children had to go to the mainland, on an inadequate bus service or by bicycle, through narrow, winding and dangerous roads, in the morning rush


hour and had to repeat the process in the reverse direction in the afternoon rush hour. The people said that they ought to have a secondary school on the island. The Isle of Dogs is a bit cut off and has by far the worst transport problems in London. It probably has some of the worst transport difficulties in Britain outside the Highlands of Scotland and Mid-Wales.
Along came the planners from the education authority. They took into account all new building projected by the GLC and all new development projected by the borough council, together with land which was to be released in stages by the PLA, what was to be built there, how many people would come in and the sort of people they would be. Doubtless they put it all on a computer and they proved conclusively that there would not be enough children of secondary school age to justify even a three-form entry secondary school on the island. It was a masterly piece of work and the planners proved their case immaculately.
However, a few of the local people got together and did a magnificent job, knocking on every door on the island and taking a census of all the children. They added to that figure the numbers that were known to be coming in and proved that there would be sufficient children. They were right. Now, in the most beautiful site in London, at the southern tip of the Isle of Dogs, there stands a new, medium-size secondary school looking across the river to the lovely Wren buildings in Greenwich. It is going great guns and is about to be officially opened, as usual, a year or two after it started going great guns. The local chaps knew best.

Mr. Arthur Jones: I remember the school to which the hon. Gentleman refers from our visit to docklands. I am interested in what he says about its origins. I hope he recognises that the Sub-Committee consulted the local community. We saw Mrs. Brawne of the Joint Docklands Action Group, Mr. Connolly of the East End Dockland Action Group, Mrs. O'Keefe of the Greenwich Docklands Action Group—I remember her very well—Mr. Harker of the Lewisham Docks Action Group and Mr.

Harris of the Surrey Docks Action Group. We were aware of the need to take into consideration the points the hon. Gentleman is making, and we were anxious to do so.

Mr. Mikardo: I hope that it was not thought for one moment that my remarks about the unwillingness of some people to consult local folk reflected upon the Select Committee. The hon. Member for Daventry (Mr. Jones) is right. The Committee took opinions from everyone, including the people on the ground, very fairly. Other people in high places have not been as assiduous as was the Committee in taking into account the views of local people. Those who believe that we should do that through a new town-type development corporation are wrong. There is no comparison between dock-lands and Milton Keynes, for instance, which will finish up with 250,000 people on the basis of an original community of no more than 10,000.

Mr. Raison: Originally the Milton Keynes community was probably about the same size—or possibly larger—as the present dockland community.

Mr. Mikardo: If the hon. Member for Aylesbury (Mr. Raison) had been patient he would have heard my case. I was about to say that when Milton Keynes is finished only about 4 per cent. or 5 per cent. of the people will be those who were on the ground when the project began and that over 90 per cent. of the people will be new to the area. That will not be the case in dockland, and certainly it will not be the case in the congested area of Tower Hamlets. The population now is about 28,000 and it will be the same when the development is complete. The overwhelming majority of the people who will be there at the end of the scheme will be those who are there now. That is why there is no comparison. That is why democratic institutions must be used.
I understand the criticisms made of the Docklands Joint Committee because it is a natural target. The way in which it is constituted lays it wide open to charges of rivalry and so on. In practice, after a pretty sticky beginning, it has done reasonably well. I do not know of any scheme that was desired by any of the five boroughs that has been vetoed as a result of opposition from the other


boroughs. I do not know of any scheme that was suggested to the joint committee by one of the boroughs that was not approved. It cannot inhibit action or be as much of a cockpit of rival interests as hon. Members have tried to make out.
The situation is also different in this area from that in the new towns which were built on virtually green fields. This area has suffered four successive forms of blight. I again apologise to members of the Select Committee for repeating some of the evidence that I gave to the Committee. I said that it was an area which for a long time—for more than a century—had what might be called socioeconomic blight. Between 1939 and 1945 it got a dickens of a lot of bomb blight—much more than its fair share. Then, some years after, it suffered from rehousing blight. Roads were stopped for a period, there was an awful mess as demolition took place and between demolition and reconstruction. Roads were changed, and people had to move kids into new schools. My hon. Friend the Member for Woolwich, East (Mr. Cartwright) correctly said that we are now facing a threat from planners' blight—a blight that derives from an attempt to reach perfection. To be perfect is the enemy of the good in this case.
That philosophy means that one does nothing until one is absolutely sure that it is right. Since it takes many years to ensure that one is doing the right thing, one does not do anything at all for many years, and even then one does not do the absolutely right thing. The way in which to get on with the job is to bear the broad strategic aims at the back of one's mind. That does not mean waiting until one has the last blueprint worked out to the last detail or waiting until the last costing is worked out to the last decimal of a penny.
The development that is being undertaken by the borough of Tower Hamlets with a developer, Riverside (London) Ltd., is a cold, hard example of getting on with one part of a scheme. That has been done with the blessing of the Docklands Joint Committee and without damaging in any way the broad strategy plan.
There are two principal needs of the people in the area—not of the area but of the people who live there. Those needs are decent houses and work. As hon. Members have said, this is an area

of chronically high unemployment and of job losses running into tens of thousands with little or no replacement. The industrial development certificate scheme has been a slight hindrance to development and to new industry being attracted to the area. I do not say that it has been a major hindrance. I broadly agree with the conclusions of the Select Committee that the way in which the scheme was administered took the sharp edge off the harm that it might have done. Nevertheless, there is a psychological deterrent in having to apply for an IDC in one place even if one knows that the application will be treated sympathetically. Industries have a choice of two or three different places and, because they have to apply for IDCs in some areas but not in others, that weighs in their choice of areas. My hon. Friend the Member for Woolwich, East was right to say how nonsensical it is that advertisements asking people to come to an area can be used everywhere but Greater London.
There is great scope for small industry in the area. My hon. Friend referred to the splendid job that Greenwich has done in attracting industries to that area. Those industries mainly involve metal work to replace the large engineering aggregations that have moved out of the area. On our side of the river there is a tradition of small industries involving the production of consumer goods such as clothing and furniture, and people are willing to pay a little more for individuality and quality. In my area firms tend to concentrate on batch production instead of mass production. An example is the growth of firms involved in the reproduction of antique furniture. There are many opportunities for getting together such small-scale enterprises, in some cases, I should have thought, possibly as producer co-operatives.
In the end, however, it is all a matter of resources, and it does not matter through which channels they may come as long as they come. It matters not whether one calls the body a corporation of a joint committee, and it does not matter whether it is called, as a rather silly man suggested on television last night, Dockland Limited as though that makes a ha'p'orth of difference or produces a penny or an idea which would not otherwise have existed. Whatever


one calls it, in the end it comes down to a matter of resources. They must come in greater quantity than hitherto.
A number of hon. Members have been concerned during the debate with transport facilities in the area. They were right to have been so concerned because a great deal of the prosperity of the area and its attractiveness to people to live there and bring work to it depends on its transport facilities. I do not want to enter into the road versus rail argument, or the Northern Fleet route versus the Southern Fleet route argument.
London has one very wide road which carries very little traffic. It is the River Thames. It is much wider than any other road in London, but it carries much less traffic than any other road in London. It is much cheaper to maintain than any other road in London because it does not have to be dug up and resurfaced every now and again. Providence has given it a beautifully smooth surface along which traffic can pass with the minimum expenditure of energy because it has a very low friction coefficent. So what happens? We do not use it. We take it less and less into account when we are planning for the requirements of the community.
At the very time that the M4 and the M40 were being built with the idea of creating easy transport between South-East England and the West Country, South Wales and the Midlands, Brentford Dock was shut. It was a very good efficient little dock. If, instead of shutting it, it had been kept open and a spur road to the M4 had been constructed—there already was a branch railway line connecting to the main line—with the new barge-aboard ship developments there would have been on earthly reason why the dock could not have been used. Barges could have been discharged from ships in the Thames and sent up to Brentford, where their cargo would have been put straight on to road or rail transport to the West Country, Wales and the Midlands.
Shortly afterwards, Covent Garden market was moved to a site on the river at Nine Elms. At that time much of the imported produce for the market was unloaded in the Canary Wharf in the West India and Millwall group of docks. The produce was off-loaded landside on to

lorries. If those who had planned the Nine Elms Market had thought of using the river and had cut an access from it to the new market, all those tomatoes, onions and other produce coming into the Canary Wharf could have been offloaded waterside into barges instead. Just think of the lorries that have to chug along from Millwall to Nine Elms. There is no way of making that journey without passing through some of the most difficult and congested roads in London.
One tug pulling or one pusher pushing four barges is equivalent to 120 10-ton lorries. So at the very time that the great improvement was being made to move Covent Garden Market away from the Strand to a site at the side of the best, easiest and cheapest road in London, no move was being made to provide access to it from that road. Can anyone imagine a company building a hypermarket such as that at Brent Cross with an entrance 100 yards north of the Great West Road but with no access to it from that road? That is exactly what has happened with Nine Elms Market.
We seem perversely determined to choke the river with idleness. It is not too late to do a great deal to reverse that idiotic process. I wonder whether the Select Committee, which did such a good job of studying this matter, might have looked at what could be done to make better use of London's river. Not only dockland but the whole of London could benefit enormously from such better use.

6.47 p.m.

Mr. Geoffrey Finsberg: I am sure that the House is grateful to the hon. Member for Bishop Auckland (Mr. Boyden) for setting out the basic facts of this debate so clearly. I am sure that the House is grateful, too, for the friendly, kindly and skilful way in which he chairs the Committee. As a member of one of the other Sub-Committees who has to sit under his chairmanship, I am perhaps doubly qualified to say that.
My hon. Friend the Member for Daventry (Mr. Jones), who was Chairman of the Sub-Committee, called for a much greater sense of urgency and asked the Government to act on this matter rather than merely consider what they were going to do. Many right hon. and


hon. Members have quoted the conclusion of the Government's observations. I think that it would perhaps sum up everything in that document to say that too much thought paralyses action.
The right hon. Member for Bermondsey (Mr. Mellish) made one of his characteristic speeches. They are always full of sound common sense drawn from his deep knowledge of the area. He said something that very few of those who have studied the matter sufficiently would disagree with. It was that this plan could have been carried out by a development corporation which could have done all the necessary consultation, and that there would have been progress which we have not yet seen.
The time for that move is now probably past. But perhaps what we say may be learned by those who are having to think about the replanning of the docklands in Liverpool. Perhaps what I may call a self-destructing corporation might be set up which after, say, 10 years of operation could hand over control to local government. The sad thing that the right hon. Gentleman said was that he could not influence his own Government to act along the lines he had suggested. It is a sad thing and shows how little power any Chief Whip has when faced with the advice that civil servants give to a departmental Minister. This is no attack on the right hon. Member for Bermondsey but is probably something with which most Ministers would agree in their hearts.
The right hon. Member for Bermondsey said that he would listen with great interest to hear what the Minister would say to one or two pieces of evidence that he himself gave to the Sub-Committee. The hon. Member for Greenwich (Mr. Barnett), who is Under-Secretary of State for the Environment, told the Committee:
But there is in the area a general feeling of impatience about the committees that are set up and produce reports and nothing happens, and so the years roll by.
I hope that the hon. Member for Greenwich, now that he has more influence, will make sure that the years do not roll by without action. All Governments are getting the blame for doing nothing, which is a sad thing.
My hon. Friend the Member for Aylesbury (Mr. Raison) asked us to examine all aspects of dockland redevelopment and

stated that we need to relate our hopes to the needs of industry, because industry will be able to generate what we need there. The hon. Member for Woolwich, East (Mr. Cartwright) confirmed a view that many of us had that there has been an internecine battle which has marred progress over the years in dockland. I use the hon. Gentleman's words, not just my own.
My hon. Friend the Member for Melton (Mr. Latham) pointed out the need for partnership between local government and how to obtain the finance for schemes in this way. The hon. Member for Newham, South (Mr. Spearing), who always puts his points clearly and always puts his constituency interests forward, made some valuable points about transportation. These were developed, with a rather watery flavour, by the hon. Member for Bethnal Green and Bow (Mr. Mikardo). but when he talked about the smooth surface of the Thames those who try to operate pleasure steamers do not think it is smooth when great lumps of wood go into their propellers.
I was sorry that the hon. Member for Bethnal Green and Bow started by attacking something which he thought had been said by one of my hon. Friends. He thought that an unfortunate remark had been made denigrating those who live in the docklands, but I have been here throughout the debate and I know that no such remark was made. I suggest that he should attack instead his hon. Friend who told him, when he was not present, something which was not true. We thank the hon. Member for Bethnal Green and Bow for his expert advice, as an entrepreneur, on the disadvantages of the IDC system and for stating that even though companies might obtain IDCs they do not want to waste time and money going through the present bureaucratic process, even with the relaxations that have been made in London.
My hon. Friend the Member for Daventry made a point, which was picked up later in the debate, about the disposal of new town assets. On this point the hon. Member for South Shields (Mr. Blenkinsop) disagreed with him. When there is a shortage of capital, we believe that to recycle the existing capital could be one way to get new schemes off the ground. What the hon. Member for South Shields said was hopelessly out of


touch with London's problems, as he might have gathered if he had looked at the faces of hon. Members representing London constituencies. He did not say much that was of help to the major problems of London, whereas my hon. Friend the Member for St. Marylebone (Mr. Baker) brought us face to face with the up-to-date facts.

Mr. Blenkinsop: I am wondering what the hon. Gentleman is referring to. I talked particularly about the unreality of trying to bring back major industry to these areas, a view which was shared by other hon. Members. I said that this was a good rôle for small industry. I thought that this had been widely accepted.

Mr. Finsberg: I was talking about the hon. Gentleman's comments on IDCs and ODPs. If he rereads his words, he might feel that he did not say quite what he intended to say.

Mr. Blenkinsop: Will the hon. Gentleman read the report, which made quite valid and sensible comments about IDCs and ODPs?

Mr. Finsberg: Time has moved on, but the hon. Member for South Shields has not.
I move on to say something in general about docklands because there are major problems which have not yet been properly tackled. Dockland has planning blight, frighteningly high unemployment, plummeting rate revenue and appalling communications. There was talk of local authorities spending money on building up an infrastructure but getting nothing out of it. But they will get an expanded rate base. The shrinking rate base is one of the major problems of London, as the Secretary of State has said over and over again so rightly. This is a way of getting increased rates and doing something about the appalling conditions and the dilapidated housing which epitomise what the Secretary of State has called urban decay.
Despite academic protestations about such areas, however, the Government and the GLC have steadfastly seemed to ignore the vast development potential of docklands. The GLC has the land available for industry, housing, and recreational facilities and it offers the

opportunity to regenerate the whole of East London's economy. But the time-wasting and local government squablings—which the hon. Member for Woolwich, East mentioned—have been so immense that, apart from some superficial efforts at house building and the processing of planning applications, the plight of docklands remains roughly the same as it did when the Port of London moved to Tilbury in 1967.
The derelict grandeur of London's docklands is a melancholy tribute to the commercial glories of a vanished age. In their present state, the docklands are also a considerable tribute to the efficiency of economic planning controls. It was only by the rigid imposition of such controls that new development could have been stifled.
Docklands also offer an enormous opportunity to improve the housing and environmental conditions of East London. If the redevelopment opportunities are taken in an intelligent and imaginative spirit, and if new housing is constructed at sufficiently low densities and gives opportunities for a variety of tenure and ownership—as the right hon. Member for Bermondsey said, there should be opportunities for different colours and so on—the result could be not only to create new communities in the docklands area but to spearhead an attack on inner city deprivation.
Those responsible have neglected to do the most important work, which is the creation of a stable and attractive infrastructure and substructure. No one will come to docklands unless there are good rail and road communications or unless there are efficient public utilities. No new industries or jobs will be attracted to the area unless some organisation makes the effort to get them there. The docklands area cannot be looked at as a number of separate entities. If it is to succeed, it must be conceived as a whole, interdependent area which needs a policy which will deal with it as such, not as different areas. This does not mean overlooking the problems of areas such as the Isle of Dogs.
The problems of docklands are merely the problems of all London in a more acute and obvious form. London today is experiencing structural unemployment for the first time since the war. We have lost half a million manufacturing


jobs since 1961, today many labour exchanges in the capital city have unemployment rates of 10 per cent. and over, and 86,000 jobs were lost between June 1973 and June 1975.
As Simon Jenkins, in an earlier incarnation, said in The Times on 27th September 1976,
How many people could be working in dockland if local councils stopped squabbling and started looking for new investment? Indeed, by allowing sites to be cleared of existing employers, and then stopping new employers taking their place, the GLC secures the worst of both worlds.
This raises the question of whether we need new resources anyway. Broadly speaking, there are two alternative strategies for the redevelopment of dockland. The first is to create a bureaucratic monolith, with vast injections of public money, which would seek to plan on an unprecedented scale and to oversee the development of every detail of the new docklands. The second is to relax the existing planning controls and to allow the natural economic rhythms of a great city to work their beneficient effect. I have no doubt which of these strategies we should adopt. The planners did not kill docklands—the old docklands were killed by economic evolution. But the planners did ensure, by channelling all new development through the rigid system in docklands, that docklands should stay dead.
There is every evidence that planning can stifle, thwart and distort economic development, but there is no evidence that planning can stimulate such development. What the planners ought to do and can do for docklands is to provide the necessary infrastructure—new roads, new tube lines—and then get out of the way.
The GLC, in its budget for next year, will raise £50 million through rates, which will be used to defray capital expenditure. This is money which is available, and will continue to be available on an annual basis, without affecting any other policies on housing, transport and so on over and above that which the GLC spends on cripplingly high subsidies. This money has been available for use. But I fear—here I regret that I must be political—that it has been the will and the initiative of the Labour Party at County Hall that have been absent. Even Paul Beasley, the leader of

Tower Hamlets Council, according to a report in The Times in January, said that the money for docklands could be
made available from normal local authority financing'. No special Government assistance would be needed.
I am certainly not calling for any special Government help for London. All I am saying is that we should remove the disabilities that now affect London where we are unfairly disadvantaged.
I fear that the Labour Party, which when in Government has professed concern about stopping inner city decay and which in the GLC is said to be committed to arresting and reversing the death of the inner capital, has done nothing. London cannot afford to wait for a flicker of activity. The dereliction in dock-lands must be stopped now.
The way to effective action is neither complicated nor impossible financially. It is, however, necessary to free the development of docklands from the bureaucratic inertia and general deterrent that the GLC has become to any kind of employment or residential regeneration in London.
It requires, first, the establishment of the infrastructure by improving road and rail communications, thereby increasing the catchment area of people and freight. All impediments to growth must be removed—IDCs, ODPs—and the Location of Offices Bureau, which now sends firms out of London, must be accepted to have outlived its usefulness or be turned, if it is to remain, to concentrate on helping inner London instead of hindering it. There must also be sensitive and varied population mixes in employment opportunities, housing and leisure, coupled with the need for the contribution of private financial investment and property development companies in partnership with the local authorities.
In short, because of the GLC's non-commitment to installing the infrastructure of redevelopment, commerce and industry, which had and still have vast amounts of money to invest if there is an end product for them, have come up against bureaucracy. They have vast amounts to invest, but they will not commit their resources until the infrastructure is there. There must, therefore, be a definite, positive policy to attract the money that is available, which will encourage growth and potential.
We have heard a lot this afternoon in this useful debate. There is little that divides the two sides of the House, except, perhaps, the political strategy which at present is being followed by the Government and by the GLC. The attack on the present political strategy has not been confined to this side. Fairly harsh words have been used by Labour Members. What is quite clear and is apparent from every quarter is that London cannot afford to wait any longer. It has already waited for far too long.

Mr. Spearing: The hon. Gentleman mentioned the question of infrastructure and he called for action. Does he back the Leader of the GLC Opposition who says that he will go ahead with the Fleet Line, if he is given the power, without waiting for Government assistance? Would such action simply be borings in the ground?

Mr. Finsberg: I had concluded. I do not wish to bore the House any longer.

7.5 p.m.

The Under-Secretary of State for the Environment (Mr. Guy Barnett): I want rather belatedly to thank the Expenditure Committee for its report. As the House knows, the Government made their response to the report about 18 months ago, and both the report and the response have been to some degree overtaken by events—by the publication of the Dock-lands Strategic Plan and by the Government's response thereto.
I am sure that my right hon. Friend the Secretary of State, who recently came into the Chamber, wished that he had been able to be present for the whole of the debate and to respond to it. I know that every time the subject of docklands is mentioned my right hon. Friend reacts positively.
The criticism has been made by several hon. Members who have taken part in this debate that progress has been slow, that things are getting bogged down in committees or that progress is likely to be frustrated by committees failing to agree or to reach speedy decisions. I contest that. I simply do not think that it is true. My right hon. Friend the Member for Bermondsey (Mr. Mellish) said that democracy is an excuse for some people doing nothing. As I hope to show later,

that is certainly not true in the case of dockland. If it later becomes true, perhaps we shall have to think again, but the Government believe that the present structure is satisfactory. Progress to date, as I shall seek to demonstrate later, has been much better than some have been prepared to admit.
I repeat that I shall want to argue that later, but first I want to say something about organisational structure, a question which arose at several points during the debate. The suggestion has often been made that we need a corporation akin to a new town development corporation, a body that would be able to act speedily and decisively. I reject that proposition now, as I did in my evidence to the Sub-Committee. I see the attraction.
My right hon. Friend the Member for Bermondsey has a dream of certain things he wants to see happening in dockland. In his speech today and speeches he has made on other occasions he has described possible imaginative schemes, such as being able to shop by river. I do not believe that the speed with which the job could be done and the sensitivity with which it could be done would ever be achieved if we set up a body such as a new town development corporation.
There has been repeated mention of one matter. My hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo) put it very well when he talked about the degree to which communities living in dockland need, through their democratic representatives, to be involved in the development of any plans if we are to move along the right lines. I made that very point in my evidence to the Sub-Committee.
Dockland is not a well-defined or an easily defined area. It is an artificial area in the sense that a large part of it is related to its hinterland. Each of the five boroughs is associated intimately with that part of each other borough which is called dockland. I go further and say that the dockland round the River Thames is the heartland of much of the economic and social life of East and South-East London, whose constituencies many of us represent.
I return to the argument about delay. The Travers Morgan consultants foresaw 1978 as the starting year. The DJC did rather better; its strategy was complete


in July of last year. Only a month later the Government were able to approve it and give it their support. My right hon. Friend the Member for Bermondsey was critical of what he thought to be the delay, but he at least admitted that the Docklands Joint Committee's planned strategy was admirable. I do not believe that one can honestly say that the committee has moved slowly. In some respects it has done remarkably well.
New town development corporations have been held up in this debate as absolute paragons of speed and decisiveness, but it cannot be said that even they, when laying down their plans at the beginning of their designation, have moved very much faster than has the Docklands Joint Committee in this case. What is more, there is a great difference between the complexity of the situation which the Docklands Joint Committee faced and that which the development corporations faced even where the corporations were in partnerships in, for example, Peterborough or Northampton. The complexity of the situation inevitably means that it will be more difficult for the committee; it is likely to take longer, and it may even be difficult in some cases to get everyone to agree.
I believe that it is absolutely right to follow the strategy which we have followed. Where 55,000 people, represented by many hon. Members who have taken part in the debate, are directly affected, and where there are clearly defined and active communities, it is vitally important that we recognise that fact and also that those communities are part of a far wider industrial structure than just the dockland area.
My hon. Friend the Member for Woolwich, East (Mr. Cartwright), who was a member of the Docklands Joint Committee, referred to the arguments that went on part of the time between the local authorities, and the hon. Member for Hampstead (Mr. Finsberg), referred to local authorities squabbling. The fact is that the GLC and the five boroughs have sorted out their difficulties and their disagreements and have come to a unanimous conclusion. The House ought to pay some tribute to that. It is a pretty remarkable achievement for boroughs as diverse as that, north and south of the river, to be able to achieve a common

strategy. For that reason, I believe that there has been a considerable achievement.
Many hon. Members who have taken part in the debate would agree that the key to dockland redevelopment lies in restoring economic life and purpose to dockland. Concern has been expressed about the loss of jobs and closures of firms that have supplied the life blood of the area. I cannot think differently because I represent a constituency currently faced with no fewer than 1,000 redundancies. I can tell the House that the Government are fully seized of the problem, and the statement which my right hon. Friend made last August demonstrated a significant shift in Government policy.
Many hon. Members have said that much of dockland redevelopment will be dependent upon the activities of the small firms. The rise in the IDC limit means that more than 40 per cent. of firms coming to dockland do not need to apply for IDCs. From the arguments we have had so far, that seems to be the very kind of industrial activity we want to attract. In that direction, I am convinced that an enormously important contribution has already been made.
Certain criticism has been made of the fact that so far it has been attractive to firms to move to new towns and that the Government have seemed ready to assist or to encourage them to do so. But it is important to recognise the significant change which my right hon. Friend made by his statement last August, in that now the dockland area has the same level of priority as the new town corporations for attracting industry. It is second only in priority to assisted areas.
Lastly, I think we should recognise the important change that has now been made in the issue of speculative IDCs to enable the replacement of obsolete facilities. As a consequence of the speculative IDCs being granted, a major new industrial estate has been started at Beckton and some 2,000 jobs are expected to be provided in the longer term. It is likely to be the forerunner of many more. Therefore, I think that the Government have already made a major contribution towards the industrial development of the area.
My hon. Friend the Member for Woolwich, East also mentioned the importance of training, and I would agree with that. He mentioned some of the needs of industrial training which, I think, will be fulfilled in the near future. Perhaps I can correct him on one constituency point concerning Harvey's which is an important centre of training. There is certainly no danger to the training centre in our borough. He and I are agreed that a considerable tribute should be paid to our own borough for the example it has given to other boroughs by its helpful industrial policies which have gone a considerable way to attracting no fewer than 4,000 new jobs, which would not have otherwise been there. I know for a fact that other boroughs in the dockland area are already showing signs of following the example set by Greenwich in employing an employment development officer and in the helpful assistance that a local authority can give—but which has not always been given in the past—to the development of industry within its own area and to providing bady needed employment.
The key to development in terms of jobs and housing lies in the issue of land. That is why I am glad that the constituent authorities of the DJC have agreed to the formation of the Docklands Land Board which will operate under the DJC's direction. It will be the first such board to operate under the Community Land Act. It will have powers to acquire and hold land, to enter into leasehold partnerships with private developers, and, acting jointly with local authorities, to operate as an industrial development agency. We hope that the board will be in operation by Easter.
I believe that that development is valuable to industry and to housing whether public or private, but even in advance of the formation of the board, the DJC is already carrying out preliminary work, and the Government have agreed to its acquisition of about 220 acres for redevelopment in line with the docklands strategy—that is, four sites for a mixture of public and private development.
I stress that docklands, along with other inner city areas currently under review, will be accorded priority. Therefore, I do not think that there will be an adverse

effect on land acquisition in docklands under the Community Land Act as a result of the present continuing economic constraints.
I want to say a word about the way in which the Government's docklands policy fits into the inner city policy as a whole. My right hon. Friend's committee, which is studying the future of inner city areas, regards dockland as a major and vital part of those studies. They have been carried forward very urgently. We hope that the Government will be in a position to make a statement in a few weeks. As the House knows, the Government's consideration represents a major departure from the post-war consensus, criticised in this debate, on the dispersal of the population from our cities. The policy of dispersal is far less relevant now than it was 10 or 20 years ago. The criticism heralds a new approach which has received wide support from our cities. London Dockland was extensively developed in the Victorian period, and its concentration of economic and social problems now need to be tackled.
On the economic front, it is partly a matter of investment and of providing modern industrial premises to replace those which are now obsolete. It is partly a matter of providing encouragement to small firms, and partly a question of providing conditions which make these areas attractive and potentially profitable in terms of sites, road access and labour force. At the same time, it will be necessary to relieve immediate social stresses, continuing the attack on longstanding housing problems and concerning ourselves more than in the past with the contribution which the health services, the education service and the social services make to the wider environment of an area.
My right hon. Friend's committee is considering whether the main programmes of the central Government and local government should to a degree concentrate on selected inner urban areas, and whether some new form of partnership may be required, involving the central Government and local authorities, to get the right mix of measures in an individual area and to co-ordinate the necessary action. The experience of the Docklands Joint Committee itself may have something to teach other parts of the country


as an example of local authority co-operation with a certain degree of Government involvement.
In the present economic climate, no extra money is available waiting to be earmarked for inner areas of cities. Any extra expenditure will have to come from within the totals of public expenditure that have already been set, but there is room for reallocation both within local authority budgets and in Government programmes. I believe that this approach is entirely compatible with the approach adopted by the GLC and the five London boroughs responsible for the dockland area, which have evolved both an appropriate sense of priorities and an appropriate working mechanism in the joint committee.
I take a more optimistic view than certain hon. Members about the future. I end by saying that I genuinely mean my thanks to the Sub-Committee for its report. There is no doubt that, in the long-term thinking about dockland, the report and the way the Sub-Committee considered evidence has been of great value, and this debate in itself, with the comments that have been made, will be taken seriously by the Government in their own consideration of inner city policies so far as they affect dockland.

Question put and agreed to.

Resolved,
That this House takes note of the Fifth Report from the Expenditure Committee Session 1974–75 (House of Commons Paper No. 348) on Redevelopment of the London Docklands, and of the relevant Government observations (Command Paper No. 6193).

CHRYSLER UNITED KINGDOM LIMITED (EXPENDITURE COMMITTEE'S REPORT)

7.23 p.m.

Mr. James Boyden: I beg to move,
That this House takes note of the Eighth Report from the Expenditure Committee Session 1975–76 (House of Commons Paper No. 596) on Public Expenditure on Chrysler UK Limited, and of the relevant Government observations (Command Paper No. 6745).
This report is the result of six months of very intensive work by the Trade and Industry Sub-Committee of the Expenditure Committee. It worked extremely hard. It held more than 50 sittings, examined 150 witnesses and received more than 100 memoranda. There was a special feature about the way it operated. It took a great deal of its evidence on site. It visited all the Chrysler United Kingdom Limited manufacturing operations in Great Britain. It talked to the workpeople and to the management. It toured the factories and it took formal evidence ft om witnesses against their own surroundings—the factory, the company office and the works canteen.
My experience of the Defence Sub-Committee has shown me that witnesses are often a good deal more forthcoming when they are examined in their home territory. The Defence Sub-Committee has found this to be so particularly in relation to Service chiefs who have been examined, for example, in Germany or Hong Kong. The Trade and Industry Sub-Committee has now discovered that this is a very effective way of getting the best evidence.
There is, however, one small technical hitch. It did not apply in this case but it should be mentioned. This is the archaic custom of the House which enables the Shorthand Writer to the House to control how shorthand writers are deployed overseas. I have given evidence on this to one of the Houses's Committees and I hope that before very long what I suggested to it will be seriously considered by it and adopted by the House. It is an archaic custom, smacking a little of the eighteenth century, and to some extent it impedes the taking of evidence overseas. However, that did not apply to the Trade and Industry Sub-Committee's work for this report. I merely thought


that it would be useful to put the point on record at this stage.
The Trade and Industry Sub-Committee's inquiry was also somewhat unusual in the sense that, instead of taking a fairly broad subject, as many Sub-Committees do, it made a detailed and intensive study of one particular case. This exposed the members of the Sub-Committee to particular burdens—for example, of travel and very heavy sessions. They were extremely well served by the specialised advisers they co-opted.

Mr. Robin Maxwell-Hyslop: Hear, hear.

Mr. Boyden: I am glad of the hon. Gentleman's endorsement. Those advisers included economists, accountants and management consultants, and this has become a very good feature of Sub-Committee work. Nearly every Sub-Committee these days has one or more expert advisers, and one of the striking things is that the leading experts in the land are prepared to act as special advisers to our Sub-Committees in the different subjects, taking very modest pay and suffering considerable personal inconvenience. This is a suitable occasion for me to pay tribute to the whole range of specialist advisers who have helped us over the last year or two.
From our point of view the system is both economical and flexible, and no one can say that the Expenditure Committee is extravagant with public funds when making its studies and reports. There is certainly no feeling that we should try to imitate the Congressional style of having elaborate staffs and perhaps producing what is, I should think, a somewhat conservative impasse from time to time simply because the staffs are there and have to be employed. At the moment, many of our Sub-Committees are making excellent investigations with extra assistance to our own very good staff. I must emphasise that I am not making any criticism of our Clerks in the House, who service our Committees on the procedural side and are devoted. The combination of permanent staff and temporary advisers has been most effective.
This inquiry needs to be considered against the background of previous in-

quiries by the Sub-Committee. The Expenditure Committee for some time has had an interest in the spending of public money in the private sector and has looked at a number of matters there. The major inquiry which, in a sense, led to this one was into the motor industry as a whole. The Sub-Committee began it in 1975. Its main interest then was British Leyland. The Sub-Committee was particularly worried about some of the procedures that the Department of Industry had followed and was critical of some of the ways in which the money in relation to British Leyland was spent. It turned with a certain sense of anticipation to the investigation of the Chrysler financial transactions, rather in the hope that the Secretary of State had taken some notice of its previous investigations and recommendations. The Secretary of State, of course, will answer for himself, but the Committee is inclined to think that the Department has taken notice of the British Leyland recommendations and investigation. The Committee is much more pleased with several things about the right hon. Gentleman's reception of this report and his reaction to it.
The Committee thinks that there has been much greater cost-effectiveness in relation to the Chrysler subsidies. It makes a marked distinction between the slight and rather dismissive reply which the Government made to the report on the motor vehicle industry as a whole and the careful and detailed reply to this report. That is one of the bases on which the Committee thinks that the Government have taken notice.
However, on behalf of the Expenditure Committee as a whole, I must say that it is not good enough to take eight months to make a reply. The only crumb of consolation is that, when it was announced that this debate would be held today, the Department hurried up and has produced the White Paper which we have before us rather more quickly than it would otherwise have done. That, however, is a small thing compared with the eight months' delay.
I make this general statement. We have just been debating a report on which the Department of the Environment made its answer in three months. I do not suppose that that led members of the Committee to throw their hats in the air, but three months is much better


than the time that many other Government Departments take in making their replies.

Mr. Maxwell-Hyslop: Before the hon. Gentleman leaves that point, I think we should notice that the eight months that it took to produce the Government's response to the motor vehicle industry worse than the much-criticised time of five months taken to produce the response to the motor vehicle indsutry inquiry. So response time seems to be lengthening rather than, as we might have hoped, shortening.

Mr. Boyden: I am grateful. As a general comment, if the Department is having some difficulty in covering the whole of a Committee's report, it would be more courteous and helpful if the Department issued an interim reply, producing the full reply later. In any case, eight months was far too long for producing a main reply.
I pay tribute to the Chairmen of the Committee, originally my hon. Friend the Member for Sheffield Attercliffe (Mr. Duffy). Until his ministerial appointment, he was Chairman of the Trade and Industry Sub-Committee when it was inquiring into the motor industry and British Leyland, and he chaired half the inquiry which we are now discussing. He was an ebullient Chairman who worked his Committee very hard, but I am delighted to say that its members responded very well to his drive and hard work and that they have done a substantial job over the last two years or so.
My hon. Friend the Member for Goole (Dr. Marshall), who I hope will catch your eye later, Mr. Deputy Speaker, then took on the chairmanship of the Committeee and also followed with very hard work and penetrating analysis all the material which came before it.
Perhaps I might repeat in the presence of many of the Trade and Industry Sub-Committee something that I said in the last debate. One of my objectives as Chairman of the Expenditure Committee has been to develop good relations between the Sub-Committees and the Secretaries of State with whom they deal. At the end of the day, if a Secretary of State is not satisfied that the Committee is doing good work, or if he refuses to give evidence, or gives very limited evidence, there is little that the Committee

can do. We can have a row in the House, but at the end of that the Whips usually deal with the situation or the row runs into the sand.
It is not the intention to make the Committees lackeys of the Departments. No one who has read the last few reports could think that that has been so. But is it very important that a Committee should have the confidence of the Secretary of State and his senior officials, and vice versa. Although there has been some acrimony over British Leyland and Chrysler UK, I think that at the end of the day much better relations have been established. I think that the Committee has helped to push forward the proper expending of public money, and I thank its members for what they have done. I hope that the Secretary of State will feel inclined to say the same.

The Secretary of State for Industry (Mr. Eric G. Varley): indicated assent.

Mr. Boyden: I see that my right hon. Friend agrees.
This is unrewarding work in many aspects. Few of our constituents, I should think, care a damn whether we are on the Expenditure Committee. There is little publicity in the sense that many hon. Members want it, and it is hard work. At the minimum hon. Members meet once a week, and they are then called to meetings of the main Expenditure Committee to consider the reports of other Sub-Committees. I am grateful that there are in the House not quite 49—there are one or two backsliders—but a couple of score of hon. Members who give their attention, their brains and their energies to these matters and who forward the cause of good government in the process.

7.36 p.m.

The Secretary of State for Industry (Mr. Eric G. Varley): I hope that it will be convenient if I indicate at this point the Government's view on the Eighth Report of the Expenditure Committee. My right hon. Friend the Minister of State will wind up the debate if there is time. We do not have much time, so I shall try to keep my remarks to the minimum.
I agree with my hon. Friend the Member for Bishop Auckland (Mr. Boyden) that the Committee worked extremely hard and did a thorough investigation.


We found it helpful and useful, although the House will not expect me to agree with every criticism that the Sub-Committee has made.
I take full personal responsibility for the delay in replying. Detailed work went into responding to the Committee's criticisms, conclusions and recommendations. I am glad that my hon. Friend was able to welcome our response. I shall look into the possibility, in future, if it is practicable of my Department issuing an interim reply. I certainly intend to establish good relationships with the Select Committees that call the Department of Industry to give evidence.
I am certainly glad that the Sub-Committee did not dissent from the decision which the Government had to take in December 1975. The report and our reply deal with past decisions. Although I shall say something about the past in a moment, I should like to say a little about how important it is to consider what has been achieved since January 1976 and what the prospects are for the future.
It is now 15 months since the House gave its assent to the Government's plans for assistance to Chrysler United Kingdom. The company undertook an unprecedented reorganisation; substantial changes were made and they were accomplished rapidly. The management and work force developed a detailed and invaluable dialogue about future plans and proposals; this has provided the material for the planning agreement between my Department and Chrysler which was signed last Wednesday.
While all this was going on my Department developed a working relationship with Chrysler, which is giving a real and effective insight into the company's operations. I myself have met the management of Chrysler United Kingdom frequently to review progress and I keep in touch with the Chairman of Chrysler Corporation, Mr. Riccardo. There can be few companies in which the Government, management and workers are so well informed about what is going on or are so closely in accord about what must be achieved. Eighteen months ago the future of Chrysler United Kingdom was very uncertain, and the livelihood of many thousands of workers was in jeopardy. In many ways the progress since then has been considerable.
A great deal still remains to be done, and neither the Government nor the company are complacent, but a great deal has been done to build a solid and reliable foundation on which the restructuring of Chrysler's British operations can move forward. The new production line to produce Alpines at Ryton for the domestic market was installed in record time. It came on stream on schedule, and the cars have been well received in the market. They are rapidly establishing a high reputation for quality. A new foundry has been installed at the Stoke engineering plant, which makes all the power trains for United Kingdom produced cars, including now the Alpine, as well as other components, including some for French production. A major face-lift has been carried out on the Avenger and production transferred to Linwood. A new car has been designed, and production will commence at Linwood in the summer for introduction later in the year. Arrrangements have been made to increase the supply of kits to Iran and the integration of the United Kingdom operation into Chrysler Europe has proceeded.
These are solid achievements. No less important, however, is the improved industrial relations climate, even taking account of current problems. In 1976, Chrysler lost 80 per cent. less working hours through industrial disputes than in the previous year, despite the upheaval of physical reorganisation. These encouraging improvements stem from the company's realistic approach to communications and a genuine and sustained effort to inform the workforce and to take its views into account.
The present problems at Linwood are a set-back. It is essential that the dispute should be solved very quickly, because Chrysler has the market demand for its products and success depends on satisfying the customers.
The House has been concerned about Chrysler's financial progress. The House will recall that the maximum potential commitment to the company was £162½ million by way of loss subvention, loans and guarantees, but already it is clear that the Government's actual expenditure will be substantially less. Of the total sum, up to £50 million was available to cover 1976. Subject to final audited accounts, just over £41 million will be


required. That is more than the estimate of £40 million made at the beginning of last year, but, if we take into account the effects of the depreciation of sterling and other factors which could not have been anticipated in January 1976, we see that financial performance has been in line with the expectations of the turn of the year 1975–76.
I must say that the failure to achieve production targets on the Avenger at Linwood and to a lesser extent the Alpine at Ryton have contributed to the losses. A lack of cars to sell has affected penetration of the United Kingdom and export markets. Even so, Chrysler sold more cars in Britain last year than the forecast in the Government plan. But, against that, more of these cars came from France than was planned. Export figures were much more disappointing, largely as a result of delays in re-introducing the Avenger in Europe. Commercial vehicles performance was not in line with expectations. This was due partly to the demand situation and partly to the loss of confidence at the time of the difficulties. All this has obviously influenced the financial position.
Comments have been made about the profits for 1976 announced by the Chrysler Corporation a few weeks ago. But I find that the attacks on the Government make a change from the suggestions made in January last year that we had taken a lame duck as a partner. I remember being cross-questioned very closely on this point when I went to the Sub-Committee. We believed at the time we came to the arrangement with the company that it would be able to meet its obligations. The recent figures serve to confirm that we have a viable partner, willing and able to play its part in turning Chrysler United Kingdom round.

Mr. David Madel: The Secretary of State mentioned that what had been expected of the commercial vehicle side had not quite been reached. Can he say anything about possible Post Office orders for Chrysler commercial vehicles?

Mr. Varley: I have the commercial vehicle figures somewhere in my notes. There has been a substantial order for the Dodge van manufactured in the United Kingdom. Perhaps I may say more about that a little later.
I was making the point that the Chrysler Corporation has sold more cars than it expected within the terms of the 1976 agreement with the Government, but has not sold quite as many commercial vehicles as expected, because of the matter of confidence and other factors which are well known to hon. Members and which were examined by the Committee.

Mr. Kenneth Clarke: Does the Secretary of State agree that the reason for the Government's having to step in with the necessary finance last year was that the Chrysler Corporation's financial position was such that it could no longer be the main provider of money to Chrysler United Kingdom? Now that the Corporation is making record profits, is there any reason for the Government to continue to be in a position where they will underwrite with taxpayers' money losses which may be made by Chrysler United Kingdom over the next two or three years?

Mr. Varley: We hoped and expected the Chrysler Corporation to recover when in 1975–76 we made a deal with the corporation, details of which were laid before the House. We must stand by that deal, and we do. We do not envisage that the agreement will be renegotiated by either side. A substantial subvention has been paid for 1976, but we hope that the agreement to share losses in 1977 and 1978 will not have to be put into effect—it may, but we shall not know until later in the year. We hope that Chrysler United Kingdom will start to make profits this year, but we shall have to see how matters develop over the year. But I do not envisage that the Government will change their plans. As a result of the Chrysler Corporation's activities and the turn-round of its fortunes—

Mr. Michael Grylls: rose—

Mr. Varley: I had better continue, because I can now give some precise information to the hon. Member for Bedfordshire, South (Mr. Madel), who asked about commercial vehicles. The Post Office has ordered 1,600 vehicles from Chrysler, at a cost of £2¾ million. If the hon. Gentleman would like more information, I shall see whether I can obtain it for him if he drops me a note.
We see a profitable Chrysler Corporation giving strength to its counter-guarantee to our underwriting of the £35 million loan provided by a consortium of clearing banks and to our guaranteed loan of £28 million. More especially, the strength of the Chrysler Corporation will enable it to give greater support in the long term to the foundation on which we are helping to build. We are trying to secure this and to make a sound arrangement for Chrysler United Kingdom.
I am sure that most hon. Members will agree, as I think the Trade and Industry Sub-Committee agreed, that the success of Chrysler in Britain depends upon successful integration with the company's European operations.
Over the past months real progress has been made in this direction, both organisationally and in products. The new small car from Linwood, the 424, will be in the showrooms of Europe later this year. This will mark an important step in this integration, and the Europeanisation of the commercial vehicle range is well under way as well. This integration would not have made sense if Chrysler Corporation had not demonstrated that it was a viable and prosperous partner.
A feature of European integration is, of course, cross-sourcing of parts. The Sub-Committee examined this carefully in connection with plans for the Alpine. Good progress has been made towards the target of 57 per cent. United Kingdom sourcing for this car. Final decisions on the possibility of complete United Kingdom production will be taken towards the end of the year. If this course is taken it will clearly make a worthwhile balance of payments contribution. In my view it would not go against the principle of integration, taking into account the likelihood of sourcing components for French Alpines from this country.
The success of Chrysler United Kingdom in getting a proper share of the overall European market will, of course, depend upon its ability to meet demand. This cannot be achieved without continuity of production. Much of the work of the last 15 months could be wasted if targets are not achieved, productivity is not improved and dealers need to look elsewhere for products to sell. This is not

just a matter of avoiding disputes or strikes and stoppages; it involves consistent performance and good management as well.
Integration is not simply a question of organisation and finished products. Components have an important rÔle and the sourcing of Alpine parts in Britain provides opportunities for supplying the same parts to France. As I have said, this is already happening with components from Stoke and I am sure that the component industry will not be slow to recognise its opportunities.
Another helpful development has been the special effort which Chrysler has made to draw the attention of United Kingdom component suppliers to opportunities which exist in the Corporation world-wide. This is further potential benefit stemming from the closer integration of Chrysler United Kingdom in Europe and within the corporation as a whole. That is the situation of car production.
I would say a few more words about the commercial vehicle situation. As I have pointed out, this is less satisfactory. Confidence in Chrysler as a supplier was badly eroded in 1975 and restoring it is proving more difficult than was expected at the time of the Government agreement with Chrysler. But the re-organisation of the commercial vehicle operation and the model programme has gone ahead according to plan and United Kingdom built vehicles will form an essential part of the company's European range.
The Chrysler management has demonstrated to me that it is tackling the problems here as urgently and energetically as it can. In this sector demand is the problem. With cars we can sell more than there are available, so we have a different problem altogether.

Mr. Madel: I am sorry to interrupt a second time. Will the Secretary of State remember that much depends on the uninterrupted supply of components into Dunstable not only from Chrysler but from others, such as Rubery Owen? Will the right hon. Gentleman bear in mind how vital it is to have peaceful industrial relations among the component suppliers?

Mr. Varley: I do not disagree with that at all. Interruption in supplies badly


affects not only Chrysler but other major car manufacturers. I hope that the situation with regard to some supplying companies can improve. But the components industry, as hon. Members recognise, has a very good record not only with regard to supplying the home market but also supplying export needs.
The key to the success of the rescue lies in meeting production targets and satisfying dealers and customers at home and abroad that their requirements will be met on time with reliable vehicles. I am encouraged to learn that Chrysler has got this arrangement with the Post Office. I had better make this correction straight away. I said earlier that Chrysler had secured orders from the Post Office to supply 1,600 vehicles. It is slightly smaller than that—1,300 British-made Dodge vans—but the value of £2¾ million is the same.
The capital investment programme agreed under the Government plan has gone ahead well. The House will appreciate that it is not possible for me to reveal commercially confidential information. But I can say that the long range plans up to and beyond 1979 envisage the possibility of even greater investment in Britain than was forecast in January 1976. These plans will depend upon performance, and they will not involve any additional demands on the taxpayer. All this will of course mean more jobs in the future.
At present about 19,000 people work for Chrysler with a further 1,500 to come in Linwood from April when a second shift is introduced. This is especially welcome in West Central Scotland and provides the creation of new opportunities there. Apart from capital investment and management, the wholehearted co-operation of the work-force is obviously essential to good results. The discussions leading up to the planning agreement are a significant step towards creating a better understanding.
Workers representatives in Chrysler know in detail what the plans, constraints and targets are. They have been told that again and again within the planning agreement discussions and the joint consultative procedures that exist in the company. Their representatives have stated in public that suspicions have been allayed and the basis for future relation-

ships established. When I say "their representatives" I mean the trade unions' representatives. Chrysler's efforts, and those of its workers representatives, are to be commended.
It goes without saying that a well-informed work force is seen by everyone in Chrysler as a prerequisite to success. The progress so far achieved by Chrysler since January 1976 has been real and encouraging. The company now has good new or updated products on sale or on the stocks and markets that want these products. The first objective of our assistance has been achieved. There is still a long way to go. Losses of production for any reason could undermine the prospects of long-term success and the situation can rapidly change if there is a loss of production for a sustained period. The Government have established machinery which ensures that we are fully informed of progress and difficulties. Our understanding with the company's management and workers' representatives enables free discussion in an atmosphere of what I believe to be trust.

Mr. Grylls: Will the Secretary of State try to answer the question of my hon. Friend the Member for Rushcliffe (Mr. Clarke) about the losses of £40 million under-written by the Government for 1976? Does not the right hon. Gentleman now recognise with the benefit of hindsight that he was taken for a ride by Mr. Riccardo? It would have been much better to have written into the agreement a clause saying that in the event of the Chrysler Corporation making a huge profit—it did, of £251 million—we the British taxpayers would not have under-written the losses? Surely, with the benefit of hindsight that would have been sensible.

Mr. Varley: I am afraid that I do not agree with the hon. Gentleman. I do not agree with any hon. Members on either side of the House who say that. Clearly they have not read the report of the Select Committee which said:
… the fact that Chrysler Corporation were fully prepared to withdraw—and indeed, as the Secretary of State for Industry told us, it became clear during the negotiations that withdrawal was the course of action Mr. Riccardo had actually recommended to his Board—meant that the pistol was certainly loaded.


Those are not my words, but the words of the Select Committee chaired by my hon. Friend the Member for Goole (Dr. Marshall) and on which there were distinguished Opposition Members.

Sir Keith Joseph: I hope that before the right hon. Gentleman sits down he will give some attention to the formidable criticism of the Committee and refer at least to the conclusion of the advisers to his Department that Chrysler United Kingdom would not be viable—a conclusion which the Sub-Committee of the Expenditure Committee adopted as its own. Surely in a debate on the Expenditure Committee's report and the Government's answers to it the right hon. Gentleman will refer to these basic isues between the Government and the Committee.

Mr. Varley: I have referred to that. I said at the beginning that I was glad that the Sub-Committee did not dissent from decisions that the Government had had to take in December 1975. I could have quoted chapter and verse for the Expenditure Committee's conclusions and our response to them and how they coincided with our views and the views that we took at the time.
The right hon. Gentleman said that the Committee made serious criticisms and reached different conclusions. I want to conclude my speech so that others can take part in the debate, but I want first to quote from paragraph 276 of the Expenditure Committee's report. The Committee said:
On the basis of Chrysler United Kingdom's progress so far, and of our examination in Chapter VIII of the prospects for success, we regard the Secretary of State's views of the company as being substantially justified.
The Committee said in paragraph 295:
It could be argued that the Government concluded the right agreement for the wrong reasons.
I accept that that is what the Committee said, but it also said that, given the facts at the time, there was no alternative but to go ahead with the agreement that we made. We could go over the ground in great detail, but I do not think that that would necessarily advance the case for taking the action that we did.
Last year, when I recommended our proposal to the House, and which it

accepted by a fairly large majority, I was cautiously optimistic. I am glad to see that the Committee found that view justified. I am not pretending that Chrysler United Kingdom is out of the wood. It depends on getting continuity of production to satisfy the markets and making sure that it gets its operations fully integrated with Europe. That, really, is the key to the matter.
The House backed the Government's decision in January 1976. Substantially, the Committee has examined the situation and come to the conclusion that the Government had to reach the agreement that they did. When I made that recommendation, I was cautiously optimistic about Chrysler's future. I concede that by no means could we say that the operation has been an entire success—for all the factors that I have given—but I remain cautiously optimistic. I hope that Chrysler United Kingdom will succeed for all those who work in the company, and I hope that that view is shared by the House.

8.4 p.m.

Mr. Robin Maxwell-Hyslop: I think that the major function of this sort of Expenditure Committee debate is not to argue whether a decision which is irrevocable should or should not have been taken, but to see what lessons ought to be learned, and whether those lessons should have been learned earlier.
It is in that context that I start by expressing great disappointment that after the considerable criticism to which the Department of Industry was, in my view quite rightly, subjected for taking five months before it produced a truly pathetic response to the Committee's report on the motor vehicle industry, it has now taken eight months to produce its present response, and it did that only when the threat of a summons to bring the Permanent Secretary before the Committee to explain the Department's dilatoriness was in the offing, not to mention the debate that was coming on in the House.
It is in that context that the reality of parliamentary discussion becomes relevant. The House will remember that the day before the climactic Chryslerevents on the Floor of the House the Government, who had long promised the House the CPRS report and had it ready so that it could have been produced, said, under pressure, that they would place one


copy in the Library in the next day, four and a half hours before the debate was due to begin. It was only when the Speaker was asked to arrange for the Librarian of the House to produce several hundred copies of the report so that Members could see it before the debate that, with ill grace, the Government agreed to release the CPRS report. Even so, as the report ran into more than 140 pages it was not possible for the House to digest it properly before the Secretary of State asked the House for its considered opinion.
One can only come to the conclusion that the Government intended deliberately to deprive the House of the information, and the comment that appears on that subject in the Government's response is almost insolent. It is that the House was very lucky to get it at all and should be grateful, not that it should be critical of the Government's deliberately withholding information that it needed to do its duty to the country and to itself. I hope that we shall not again have a similar paragraph in a Government response to an utterly justified criticism in that context.
Another lesson that we should learn is about the relevance of forecasting, because one of the matters that the House had to consider in that climactic December was whether the Chrysler operation would jeopardise the British Leyland operation. It will be remembered that the CPRS report, which the House had so little opportunity of studying, had identified the great problem of over-capacity, particularly in the volume car section of British output.
It was in that context that the Secretary of State told the House on 15th December that if the Chrysler rescue operation went through Chrysler car production capacity would be reduced by 25 per cent. What the Select Committee found was that, far from capacity being reduced by 25 per cent., it has been increased by nearly 15 per cent. This is relevant because the fear that the Committee had that we might be robbing Peter to pay Paul is manifestly true in the case of British Leyland.
It is undoubtedly the case that the reason for British Leyland's pathetic sales is industrial troubles. It is not able to produce the cars for which there is a

willing market. Nevertheless, it is a serious matter when a Secretary of State, having deliberately deprived the House of information until the very last moment, gives information that is not just misleading in quantum, but is totally in the wrong direction—a reduction of 25 per cent., instead of an increase of about 15 per cent. That was specifically misleading to the House, and it is at least possible that some hon. Members might have taken a different view of the right hon. Gentleman's proposals had they known that the Chrysler rescue would produce an increase of 15 per cent. in its car-making capacity.
The Government's response is a considerably weightier one than the triviality which greeted the report on the motor vehicle industry, and I should like to acknowledge that progress. However, what a pity it is that paragraph 31 of the Government's response indicates that the most important matter of all—the financial consequences of the agreement—either is not understood by the Government or the Government are incapable of reading three paragraphs of the Select Committee's report. There is no other alternative, because it is said in paragraph 31 of the Government's response:
In contrast the cost to Government is said to be £72·5 million, but this assumes that CUK make losses in 1977–79 to the full extent covered by the Agreement and losses in 1976 reaching £60 million.
That is not what the Select Committee said in its report, which is why I say that it is a pity that the Government either do not understand the financial consequences or are incapable of reading the three paragraphs on the subject—188, 189 and 190—in the Select Committee's report, because the Select Committee said in paragraph 189:
If CUK shows the small profits forecast in 1977–79, and if losses in 1976 do not exceed £40 million, then the reorganisation of CUK will effectively have been achieved at an expense to the company of only £10–£12 million (for the Alpine)".
That is a true statement of fact; it is absolutely undeniable. We now know that the losses have exceeded £40 million, so the 50 per cent. share comes in on top of the £40 million.
If we take this in conjunction with the failure of the Government—which is acknowledged in their response—and of Chrysler to cost the effect of a fall in the


sterling exchange rate on the profitability of importing cars and a large proportion of the components from France, it will be seen that the taxpayer is providing a disincentive to Chrysler to enter stages 6 and 7 of the Alpine C6 programme which would be totally sourced from Britain.
It would appear from Chrysler's interim statement that the company attributes part of its losses to the falling exchange rate causing greater expenses than it expected on importing a large proportion of the Chrysler C6 from France. However, under the loss-splitting arrangement for the £20 million above the initial £40 million loss, the whole of which is funded by the British taxpayer, if there is an extra loss above that £40 million the taxpayer pays half of it. We do not know the figure—we have no means of knowing it—but it may well be that if Chrysler had been able to source the whole of the C6 Alpine in the United Kingdom there would not have been the extra £2·8 million loss, of which the British taxpayer will have to pay £1·4 million.
To continue with the Government's failure to understand the financial consequences, the Select Committee went on to say in paragraph 189:
However, unless Chrysler Corporation defaults on its £63 million liability, HMG's total financial commitment is the loss funding of £72·5 million. CUK assets secure the remaining £27 million".
The Government comment that that is misleading. They say in paragraph 31 of their response:
On the former assumptions about profitability the cost to Government would be £40 million in 1976–79 not £72·5 million".
The Committee never said that it would be £72·5 million. The paragraph continues:
on the other basis CC's costs would be £42·5—£44·5 million, not £10—£12 million".
The Committee never said that they would not be. The Government add:
Furthermore CC bear responsibility for all losses in excess of those specified in the Agreement".
Indeed, the corporation does, and the Select Committee's report said nothing to the contrary. This is what makes me suppose that whoever drafted this unhappy, would-be riposte either did not under-

stand the Government's contract, or had not read the Select Committee's report.
I conclude by referring to the comments in paragraph 296 at the end of the Select Committee's report because, as I have said, it is important to learn the right lessons—that is what an Expenditure Committee should be about. The Select Committee stated:
However, by no stretch of the imagination can the events leading up to the agreement with Chrysler be said to form a glorious chapter in the history of the Government's industrial policy. There are three main elements involved in avoiding a repetition of these events: the use of sound and precise criteria (including the quantification of social factors—which is an element lacking in the present criteria) before decisions are taken; the anticipation by Government of the imminence of an application for assistance, with its corollary that all the relevant information to enable a rational decision to be taken should be available in good time; and the timely provision of such information so that Parliament can exercise proper judgment on the basis of known facts".
What militates against those three recommendations? First, a ludicrously slow response by the Government to Select Committee reports militates against them. If the Department were incapable of producing its response for eight months, surely it must have been because it had not studied the report adequately. Otherwise we must assume that it was capable of replying to it or of issuing its response, but merely unwilling to do so.
Secondly, on the question of anticipation, the Select Committee's last report on the motor vehicle industry should have put the Department on notice that Chrysler was in danger. Despite the Department's protestations, it is amply clear that the Department did not read the danger signals in time. Moreover, to conduct an exercise of that kind when the exchange rate was already falling rapidly should have alerted the Government to extrapolating movements of the exchange rates both ways and ascertaining what the effect was likely to be on Chrysler's fortunes, as the taxpayer was underwriting its losses.
There are two aspects of the interrelationship with exchange rates which are, to an extent, unique to Chrysler. First, 50 per cent. of its exports were tied to the Iranian contract in such a manner that alterations in exchange rates adverse to Chrysler could not automatically be recouped. Secondly, as at last year, the


only new model for the immediate future, the C6 Alpine, was to be largely manufactured in France. Both factors were known to the Department before the crisis descended, before the moment of decision arose, and yet their relevance clearly was not appreciated by the Department until the Select Committee highlighted them in its examination of Chrysler's witnesses, which occupied more than 90 questions.
In that context it is quite clear that Mr. Hunt and, to a lesser extent, other Chrysler leaders did not realise the potential effect on their own profitability that the movement in the exchange rate would incur. They had assumed that the dollar parity would remain at $2·02 cents, but it certainly was not that when the agreement started to bite.
These are the lessons that we should learn, but they depend on the willingness of the Government to co-operate with the House of Commons. I quote once again:
The timely provision of such information so that Parliament can exercise a proper judgment on the basis of the known facts.
It was within the Government's power to publish the CPRS report in good time for it to be adjusted. The Government chose not to do so. The proper -course of action would have been to apologise to the House, not to say that the House was lucky to have had the report at all.
Before I sit down I pay tribute to the specialist advisers who gave generously of their time at considerable personal inconvenience. I also pay tribute to the competence, hard work, and flair of the Clerk who served our Committee, his assistants, his secretaries and typing staff.
It was unfortunate that one complete morning's evidence was lost for ever because the authorities of the House decided to use tape recording equipment rather than a stenographer. As the equipment was never turned on to record what was said, the whole of one morning's evidence was entirely lost. I mention that because it should be borne in mind when the House considers whether apparent economies of that kind are really worth making.
I am glad that, however belatedly, eight months after the full Committee offered this report to the House, time has been given to debate it.

8.23 p.m.

Dr. Edmund Marshall: The hon. Member for Tiverton (Mr. Maxwell-

Hyslop) in the course of his speech made some characteristically pugnacious remarks. Hon. Members listening may wonder how the hon. Member and I, as senior member and Chairman, respectively, of the Trade and Industry Sub-Committee, get on in the proceedings of the Committee. Let me say straight away that membership of the Sub-Committee, however versatile and diverse, still provides a very remarkable exercise in House of Commons harmony.
The report before the House is the unanimously agreed report of the Sub-Committee and each of the members of that Committee has made his own very effective contribution to the report. I echo the kind words of my hon. Friend the Member for Bishop Auckland (Mr. Boyden) about my predecessor as Chairman of the Committee, my hon. Friend the Member for Sheffield, Attercliffe (Mr. Duffy), who for many years served as a member of the Sub-Committee and gave greatly of his particular expertise.
Similarly, I pay tribute to two other hon. Members who took part in the inquiry into Chrysler and who have since left the Sub-Committee—the right hon. Member for Bournemouth, West (Sir J. Eden) and the hon. Member for Devizes (Mr. Morrison). Both gave to the Committee over many years of their particular experience and talent in the course of our investigations. The other hon. Members who served are listed on the Order Paper tonight and the House will appreciate that we covered the whole spectrum of political thought in the House and worked together extremely well as a team.
This harmony in the Committee was assisted by the very hard work done by the Clerk of the Committee, Mr. Rogers, whose efforts held the work of the Committee together. Without his work and that of his assistants and specialist advisers, our efforts would have come to nothing. The names of the specialist advisers are listed in paragraph 7 of the report, and during the Chrysler inquiry we were able to draw on new expertise not previously engaged. We are grateful for that help.
I will not go into all the salient features of the report, which includes 296 paragraphs, at length. But I will reinforce what has been said: the Committee came to the conclusion that the Government had no other option than to reach the


agreement they did with Chrysler in January 1976.
In the course of our inquiry we looked at all possible alternative course of action, and every one revealed particular difficulties or stumbling blocks. This meant that the course taken was the only feasible one, however much it has been criticised and however much some hon. Members may regard it as undesirable and second-best. It was the only decision that any reasonable person could take when faced with all the complexities of the situation.
Despite the Committee's general agreement about the final decision, it was very critical of the way in which the whole crisis around Chrysler arose and how the negotiations were conducted. We do not think that during the years 1967–75 either the Chrysler Corporation or Chrysler United Kingdom did much to strengthen the company's position in this country. The potential to achieve integration with Chrysler's operations in Europe was in no way realised, and we did not think that any attention was paid to this. Long before 29th October 1975, Chrysler should have given the Government more warning of the real extent of its difficulties in the United Kingdom. This meant that when the final crisis arose, and following the Press conference held by Mr. Riccardo in Detroit, the Government inevitably were taken by surprise. Therefore, they were at some disadvantage in the negotiations that followed.
It is interesting to examine the Government's reply, which has just been published. We have heard a good deal in this debate about the time taken for that reply to be published. I shall confine my remarks to saying that the reply is a good one, since it deals thoroughly with the content of the report. The House owes the Department a debt of appreciation on the fact that its reply is a great improvement on the last reply issued by the Department following our earlier inquiry.
The Department accepts some of the criticisms and points made by the Committee. In other respects the Committee stands corrected, because it did not have the full information when it reached its decisions. We have now at least established a proper dialogue between the

Committee and the Department which, I hope, will benefit both in the national interest.
There are some new pieces of information provided in the response from the Department of Industry. It is encouraging to note that in paragraph 3(e) of the response we are told that the Iranian National Industrial Manufacturing Company has now decided to invest a further £25 million in facilities for the assembly of Chrysler United Kingdom cars in that country. That information gives encouragement on the overall position of Chrysler United Kingdom.
Paragraph 9 of the Government's reply contains an astonishing sentence, which reads as follows:
In early 1974 the Department recognised the likely problem of future over-capacity in the United Kingdom car industry structured as it was at that time, and Chrysler's weak position in such a situation.
If that happened in early 1974, almost two years before the publication of the CPRS Report—which we were given to understand was the first time that the problems of over-capacity had been thoroughly analysed and studied—why did the Government take that line in respect of British Leyland, whose crisis intervened between the beginning of 1974 and the later period in 1975? There is something a little strange about that sequence of events.
I move to paragraph 18 of the Government's response, in which the Department defends the length of time taken in the negotiations with Chrysler following the announcement at the Detroit Press conference. The Government defended the fact that they had taken so much time. As the Chairman of the Sub-Committee, I feel that the Government have missed the main point of our criticisms. These criticisms relating to the progress of the negotiations were not just as to the length of time taken but related to the way in which the negotiations were almost conducted in semipublic.
I wish to refer to paragraph 114 of the report. We are told that my right hon. Friend the Secretary of State for Indusry told the House on 15th December 1975 that the negotiations
must take place in a confidential atmosphere".


The Committee's report then states
It was clear that this did not happen. The Government were in an embarrassing position at the start of the talks. The length of the negotiations, and the lack of security which attended them, did nothing to retrieve the situation.
I turn to the last sentence of paragraph 155:
The Government's declared intention to keep the negotiations private and confidential was in practice not achieved, with the result that it was from the media that both the House of Commons and the work force first learned of the outcome.
Those were the criticisms made by the Committee about the course of the negotiations. I think I am right in saying that the Department's response contains no reference to that line of criticism. That was perhaps understandable, because undoubtedly the officials who helped to compose the response were in no position to comment on leaks which may have occurred in the negotiations.
I move on to paragraph 37 of the Government's reply, to which reference has already been made. I think it was the hon. Member for Tiverton who spoke about this. In the first sentence of that paragraph the Government say:
In his statement to the House of Commons on 16th December 1975 the Secretary of State for Industry referred to a reduction in CUK's capacity of 25 per cent.
Please note that it refers to capacity being reduced. Later in the same paragraph, however, the last sentence reads:
The investment at Linwood in paint facilities has removed certain restraints and the total capacity for cars and commercial vehicles is now greater than it was prior to the implementation of the SLT/C6 Plan. This capacity has not of course been wholly utilised and there has been a reduction in output of the magnitude referred to by the Secretary of State.
In that paragraph there is total confusion between capacity and output, and, therefore, the criticism of the Sub-Committee in that respect still stands.
The Secretary of State has said that the important thing—following the agreement between the Government and Chrysler—is to consider how far there has been progress that will improve the future prospects of Chrysler United Kingdom. In the Sub-Committee's report some doubt was cast upon the future viability of the company, but at least we now have the planning agreement that was finalised last week—an agreement that both the Gov-

ernment and the Committee hope will carry the real commitment of those engaged on all sides of the company's operations.
I also note the arrangements that have been made for continued monitoring of the company's problems by the Department. I particularly note, in paragraph 39 of the Government's reply, the arrangements that have been made for professional accountants to scrutinise whether Chrysler United Kingdom is being subjected to adverse transfer pricing within the Chrysler Corporation. The importance of this aspect of Chrysler's activities was underlined by the recent publication of the figures to which reference has been made tonight—namely, that in 1976 Chrysler United Kingdom made a loss of £42·8 million while Chrysler Corporation made a profit of $423 million. Considering that it was the poor performance of Chrysler Corporation in 1975 that precipitated the whole Chrysler crisis in this country, the latest figures provide at least food for thought. The Sub-Committee intends to seek further information about those figures.
The Sub-Committee regards itself as having a continuing rÔle in these matters. We do not intend to slave away at a report, to publish it and to put it on the shelves and then look back with pride at what we have done. The work of any Select Committee, particularly the Expenditure Committee, must be one of continuing monitoring and continuing influence on public policy, a rÔle in which the taxpayers' interests are defended throughout. In order to be effective in this, the Sub-Committee intends, though it will mean a tremendous burden on our members and staff, never to leave any subject alone. We shall never let matters drop. We hope that in pursuing this course we shall be able to perform the rÔle of this House in relation to the government of this land more effectively.

8.40 p.m.

Sir Keith Joseph: I join with other hon. Members in congratulating the Sub-Committee on an excellent report. I am encouraged to learn from the hon. Member for Goole (Dr. Marshall) that the Sub-Committee intends to keep its teeth in the subjects that it has taken up. That is good news, but I suggest that the Sub-Committee will


have to develop not only its analytic skills, but its capacity to pin Ministers, of whatever party, against the ropes when it has legitimate criticism.
It is because of the failure of the Government's devolution Bill that we have this opportunity to discuss the Sub-Committee's Report a mere eight months after its publication. The House should not kid itself: if the devolution Bill were still going through, we should probably not have had the chance to discuss the Report for many months. It was only because of the imminence of the debate that the Government were persuaded to bring before the House their inadequate answer to the formidable analysis of the Sub-Committee.

Mr. Boyden: That is not correct. The Department had agreed to publish the Report on 16th March. It did not know at that time about this debate. The Report was brought forward by a few days, for which we are grateful, so that the House should have the papers in time for the debate.

Sir K. Joseph: Then I withdraw that part of my criticism. The hon. Member for Bishop Auckland (Mr. Boyden) is Chairman of the Expenditure Committee, the value of whose reports lies not only in the analyses contained within them, but in the degree to which those analyses can be brought home to Ministers in subsequent debates.
The Secretary of State, whom we all like, gave a bland reply to this excellent report. He wrote off the criticism with what was virtually a public relations exercise for Chrysler as it is today. We all understand the right hon. Gentleman's problem. He was in favour of a quite different solution to the Chrysler crisis, but he was overridden in Cabinet and now has to defend the consequences of a decision with which he did not agree. It is wrong for the Secretary of State to suggest that the Sub-Committee concluded that the Government had no alternative but to rescue Chrysler United Kingdom in the way that they did.
The report is a well-drafted document and Chapter XI, which is headed "Conclusion", is succinctly and incisively written. At no point is it possible to adduce that the Sub-Committee agreed

with the Government's decision. The report says that it could be argued that the Government came to the right decision, but the Sub-Committee does not make that argument or come to that conclusion itself. Indeed, I shall come later to a crucial point on which the Sub-Committee and the Government reached totally different conclusions.
The debate gives us an opportunity to look even wider at Chrysler than did the Sub-Committee in its report. There is some common ground between the Government and the Opposition and between the Government and many hon. Members opposite. I think that we all agree that this country will not prosper and have high levels of employment unless industry and services are competitive. The Prime Minister emphasised this in his brave spech to the Labour Party Conference in Blackpool last year. There was also sanctified by the Government at the Chequers meeting last summer the view, which we share, that there is a need to encourage industrial and commercial success.
The argument that many of us wish to add to those of the Sub-Committee is that the habit of rescuing companies that are in trouble is extremely damaging both to the competitiveness of our businesses and to the encouragement of success. Rescues are enervating and debilitating. If there is no prospect of rescue, companies are forced in their own interests to put their own houses in order. If they cannot do that, it is possible, through the well established mechanism, for the resources used in those companies to be redeployed as humanely as practicable into a use that the public will welcome and employ.

Mrs. Audrey Wise: The right hon. Gentleman appears to be saying that in the course of this operation many thousands of people will unfortunately be put on the dole. Presumably it is not practicable to be humane and to keep such people in work.

Sir K. Joseph: No fewer than 376,000 people joined the unemployment register in September 1976. In that same month 367,000 people left the register, ceased to be unemployed, and became employed. In other words, there is an enormous torrent of people changing jobs, some voluntarily and some involuntarily. We


deceive ourselves if we think that by the occasional dramatic rescue we alter this redeployment of labour, which must go on if standards of living are to be raised, for both pensioners and those at work.
The habit of rescue enervates and it is that habit which this Government are constantly encouraging. In a recent Adjournment debate the hon. Member for Keighley (Mr. Cryer) spoke of rescue as normal. The habit of rescue blocks the improvement that firms will carry out for themselves, with the help of those who work for them, if they do not have the hope that they will be rescued by the taxpayer. Rescues can create what the Sub-Committee vividly described as pensioner firms that become dependent upon the taxpayer.
Last week in the debate on Leyland I said that I thought that British Leyland needed rescuing from the British Leyland rescue. I said that the British taxpayer needed rescuing from British Leyland. Today I go further and say that Britain needs rescuing from rescues.
This is not—or should not be—a party issue, because rescues are not Socialism and nor are they capitalism. They are opportunism. The Chinese might call them capitulationism. They are a weak response to a crisis. They are not necessarily the constructive response that the well-meaning believe them to be, because of the debilitating and wrong expectations that they create.
I should like in this general chorus of approval of the Sub-Committee's work, a chorus with which I agree, to make one small criticism. It would have been an even more powerful report had the Sub-Committee asked itself one additional question, which is "Where is the money for the rescue to come from?" The moment one inquires into the source of the money one is led to realise that every penny that the Government will provide comes in one form or another, directly or indirectly, from the taxpayer. That money is taken from the taxpayer, either directly by raising taxes higher than they otherwise would have been, or by borrowing, with a consequent increase in interest rates and service charges, and the consequent pre-emption of resources away from the private sector.
Then, somewhere, invisibly and unnoticed by newspaper reporters, people are being thrown out of jobs. I put it as strongly as I can by saying that in order to save Peter's job it is almost always necessary to sack Paul. Peter is rescued only at the expense of Paul. Peter is generally in a firm or industry with strong trade union muscle, and Paul is in some small firm with no headline-creating capacity. Peter is rescued often in a precarious job that will not last, and Paul is sacked from a job that would have been sustainable if only taxation, interest rates, or inflation had not been so high.
Until recently I was practically alone among politicians in making this argument. However, I see in this month's issue of the National Westminster Bank Quarterly Review a scholarly article on just this subject of the unemployment consequences of employment subsidies. I venture with diffidence to suggest to the Sub-Committee that when it follows up this inquiry it examines where the money comes from.
I turn against this background to Chrysler United Kingdom, which I am sure is a well-managed part of a well-managed world operation. But however well-managed it is, its European activities are small in a world of giants. Its market share is bound to be crucial. Its sales per model and its sales per employee will count very seriously. It is with this in mind that we have to take account of the CPRS judgment that this country already has an over-capacity in car making and an overmanning in car production.
It is in this market, which is also the slowest growing market in the EEC for cars, that the Government have spent taxpayers' money to prop up Chrysler United Kingdom. We must ask ourselves, as the Sub-Committee asked itself, whether the initiative was sensible or stupid, whether the money was well spent or whether it was money down the drain.

Mr. Maxwell-Hyslop: I quite follow and substantially agree with my right hon. Friend's argument in terms of the economic effect on other industries. However, may I draw my right hon. Friend's attention to paragraph 164 from which he will see that the Sub-Committee


looked quite deeply at the cost to the taxpayer of the alternatives? The Committee did not ignore that aspect.

Sir K. Joseph: That is a separate point. My hon. Friend is right in saying that the Sub-Committee considered what would be the apparent costs of not rescuing, but it did not consider the implications of the cost of rescuing.
On the point covered by paragraph 164 I venture to suggest that the Sub-Committee swallowed whole the arguments of the Treasury and the Department. They regarded the unemployed man as being bound to remain unemployed for an average of a year. Even at this moment the average period of unemployment for those who are unemployed is, I think, six months. It is a fallacy to think that labour released from one employment is, as it were, a lump of labour that remains permanently unused. There is an intense and constant redeployment taking place.
When redundancies were invited at Linwood, 50 per cent. more men volunteered to be redundant than were required. That is evidence that the men themselves do not feel that they are doomed to longterm unemployment if they lose their job or choose to be redundant.

Dr. Edmund Marshall: Does not the right hon. Gentleman accept that if there had been mass redundancies in Chrysler they would have been concentrated geographically around the areas of Luton, Dunstable, Coventry, and West Central Scotland, already areas of high unemployment? Their opportunities for alternative employment would thereby have been less than the average national opportunities.

Sir K. Joseph: It follows from the concentration of labour in a vulnerable firm that more people will have to travel to other firms, just as they travel to their present firm. One possibility that the Government should consider most seriously is easing the housing situation so as to facilitate mobility. The housing situation in Scotland is made far worse than it need be by the fact that so many houses are in the possession of local authorities rather than private landlords, and thus, because of the subsidised rents, they are occupied by families for an infinity of time. This

is a situation to which both parties have contributed.

The Minister of State, Department of Industry (Mr. Alan Williams): Is the right hon. Gentleman aware that in a place like Rhondda 80 per cent. of houses are owner-occupied, but this does not seem to help to cure the problem of unemployment?

Sir K. Joseph: There is a special problem when owner-occupiers live in a company town and the company, in this case a coal mine, ceases to need their services. That is a problem that should be met by imaginative Government policies to help owner-occupiers in such towns.
The crux of the issue before the House is whether the money will prove to have been well spent. For that it is no good just looking at the present position. The Government's pledged contribution from the taxpayer towards the new model looks after the next couple of years or so, but what happens when the taxpayers' funds come to an end? What happens if there is not enough profitability or cash flow, or if productivity has not risen to the necessary levels for there to be sufficient cash in Chrysler United Kingdom to sustain the heavy investment necessary to keep the company viable in the 1980s?
I draw the House's attention to paragraph 293 of the Sub-Committee's report. When considering whether the company would be able after 1979 to finance a continuing model programme as well as repaying the loan, the Sub-Committee stated without qualification:
We do not think that Chrysler United Kingdom will be able to generate such funds.
The Sub-Committee went on to ask whether it was not very likely that the Chrysler Corporation would again turn to the British taxpayer. That is the question to which the House has to turn its attention. It is the question on which the Government, after overruling the Secretary of State, came to a positive conclusion and the Sub-Committee of the Expenditure Committee was sceptical to the point of coming to a negative conclusion.
We are in an even better position than the Sub-Committee, because after a few more months we can see more of the performance of Chrysler United Kingdom. We can welcome the fact that for some


months there appear to have been better labour relations. It looks to a sceptic—I am a sceptic about rescues—as if the psychological effect of the real risk of closure altered industrial relations for some time. It looks as if that happened. I have read tributes by the management to the changed relationships. However, I fear that the climate is changing before our eyes and, although I know that productivity has crept up, I must ask the Minister whether productivity is yet anywhere near what it needs to be to generate the volume of output and the cash flow to provide the profit on which Chrysler United Kingdom is counting.
We have been told in the evidence that what Chrysler Corporation and Chrysler United Kingdom need to maintain a viable operation in this country is no miracle in connection with productivity, but simply steady, continuous output, the same as they tend to get from their other spheres of operation. What is the trend in cars per man per year—that is, in productivity—and in the steadiness and continuity of output apart from the particular problem affecting Linwood at present?
I turn quickly to the question of the planning agreement which the Secretary of State announced only last week. I myself am not in favour of planning agreements. I think that an attempt to freeze forecasts and plans in a turbulent and incessantly changing world market is a mistake. However, the planning agreement is a chosen instrument of this Government, and I must ask the Minister to answer two questions.
First, granted that the planning agreement is not to be published, because it is said to contain confidential information, why is it that the newspapers seem to have seen it? Why is it that The Times, for instance, and other papers that I have seen purport to publish details from the planning agreement? Why, if newspapers are to see the planning agreement, should not Parliament see the planning agreement?
The second question that I hope the Minister will answer is this. What is the relationship of the trade unions to the planning agreement? We are told that they have been given and have welcomed a great deal more information. That is a positive benefit. The Secretary of State said today that the planning agreement

"is closely in accord with what the trade unions know has to be achieved". That is fine, too, as far as it goes, but I have read in the newspapers that, far from the trade unions being committed in any way to the planning agreement, they not only refused to take any part in the signing of it—I am not quite clear whether they were meant to be involved in signing it—but, when asked questions about the degree to which they were committed to the productivity targets in the planning agreement, they said that they were not committed at all, that productivity was entirely a matter for negotiation.
I am one who recognises the very legitimate self-interest of trade unions and trade union members. I acknowledge that self-interest as one, and one only, of the major motives at work in any society, but one hopes that the self-interest is enlightened self-interest. I believe that we can hope that the trade unions will see the improvement of productivity as being in the enlightened self-interest of themselves and their members.
The fact is that, unless productivity improves, unless profitability is good—and these realities, these imperatives, are blurred by rescue operations—we shall, at the Government's instigation, be bleeding healthy companies in order to go on feeding what may prove in Chrysler United Kingdom to be a lame duck. I would argue that the Government are on the wrong tack in their habit of rescue. I would argue that the lessons of British Leyland, and perhaps the lessons of Chrysler, are lessons that ought to be learned by the Government. Ministers have bitten off far more than they can chew in their industrial strategy. That explains in part the delays and the incompetence. Ministers are overstretched. Taxpayers are overtaxed. Industry is overmanned.
We know that the Government changed their mind. We know that they rejected the advice of their industrial advisers who warned them that Chrysler United Kingdom would not be viable. We know that the Cabinet overruled the Secretary of State, and we know that the Government ignored their own criteria for industrial intervention. We only hope that they will learn the rapidly emerging lessons of their own failures and reconsider their own rescuing policy.
Finally, we ask that the Secretary of State should use sternly and firmly the power that he still has, that is, not to release taxpayers' money to Chrysler United Kingdom unless and until he is satisfied that the trends of productivity and profitability are on the lines that were laid out in the agreement. The least that the rescued can do is to try their best to become viable. But those who work in companies that are rescued will not think it necessary for them so to behave if they believe that the money from the taxpayer will come automatically however they behave. We say to the Secretary of State that, even if a wrong decision has been made, much can still be saved for the taxpayer if he uses his powers firmly.

9.6 p.m.

Mr. Richard Wainwright: The Secretary of State made the welcome claim that the work force of Chrysler United Kingdom is now conspicuously well informed about the nature of the company's business and the important factors in it. The Secretary of State's correct claim was a great tribute to the work of the Trade and Industry Sub-Committee in producing the report, because it is largely from the report that the information was first made available to the work force and to the public. The Sub-Committee is to be congratulated on that.
I thought that the hon. Member for Goole (Dr. Marshall), who was Chairman of the Sub-Committee, perhaps reduced its credibility when he claimed that it worked and reported in total harmony. To deny what I detected as a splendid tension running through the concluding paragraphs, and to make the unlikely claim that, for instance, the hon. Member for Tiverton (Mr. Maxwell-Hyslop) in the end was in harmony with the hon. Member for Goole, rather detracts from the credibility of this splendid Sub-Committee.

Dr. Edmund Marshall: Perhaps I did not make myself clear. I should have said that there was unanimous agreement that this should be our report. There were many moments of debate within the Sub-Committee about exactly how the report should be worded, but the final wording was totally agreed.

Mr. Maxwell-Hyslop: Hear, hear.

Mr. Wainwright: I entirely accept that the report was unanimous, but the hon. Gentleman went a little too far by suggesting that the report in some way endorsed the rescue operation, although criticising the manner of it. I do not find that endorsement in what I describe as the admirably tense and extremely well-argued concluding section of the report.
I hope that we shall have some enlightenment from the Minister about the Secretary of State's claim that the Government are now extremely well-informed about Chrysler. The Secretary of State was admirably strong today, much stronger than he has ever been before, on the matter of integration. This was a welcome development. But if his words are to have any meaning, surely the Government must ask themselves whether they are sufficiently well informed about the financial state of Chrysler Europe as well as Chrysler United Kingdom.
"Integration" is a strong word. If Chrysler United Kingdom in, say, a couple of years is looking for funds to develop new models, which will then be essential to Chrysler Europe, it is of immense importance that the Government should be informed of the financial affairs from quarter to quarter of Chrysler Europe. So far, there has been no indication that they are. It is a difficult subject, because Chrysler Europe does not exist as a corporate entity. I raise this question at the outset. When discussing such a vital aspect, we must be told by the Government just how they view Chrysler Europe and hope to encourage its development as a corporate entity.
Time being short, I shall confine myself to two concepts which I regard as of immense importance to this rescue operation and which I do not think are in any sense clarified by the long-delayed response from the Government—the concepts of viability on the one hand and of integration on the other.
The Government use the world "viability" in the most elastic fashion to meet any particular situation which they think it happens to fit well. The Sub-Committee, in its splendidly-written report, which has not elicited the same standard of prose from the Department, has given a clear lesson in the meaning


of "viability". In paragraph 293, the Sub-Committee recommends that
a profitable operating position must not be confused with long-term viability. Chrysler United Kingdom must be able not only to show profits, but to be able to generate sufficient funds after 1979 to finance a continuing model programme as well as repaying their loan.
I would like to hear how Ministers respond to that striking statement. They should also indicate whether they are going to be caught napping again. As the hon. Member for Goole made clear, they were caught napping by the pressure that Chrysler United Kingdom was so skilfully able to put on them, pressure which precipitated the rescue operation. Are the Government to be caught napping again in 1979? As I said in the original debate on the proposition for a rescue operation, I do not believe that Chrysler United Kingdom will be in a profit-making situation in 1979. They will not be truly viable.
On the question of integration, the Government have been quite inadequate in their response to the pointed question posed in the report. The Secretary of State's concept of integration, even after his stronger words today, which were welcome, still seems to dwell upon the receiving end as though integration was of great importance to Chrysler United Kingdom because it would mean that it was receiving technological, design, tooling and marketing help from the rest of the worldwide Chrysler operation. But to me, and still more to those whose jobs depend on Chrysler United Kingdom, the most important consideration in integration is to make it a means whereby Chrysler United Kingdom becomes an indispensable locked-in unit of the world-wide Chrysler operations.
If integration merely means that Chrysler United Kingdom benefits from and is aided by the world-wide organisation, it will be a continuing lame duck. We have heard nothing today to indicate that integration is proceeding in a way which gives the United Kingdom operation an indispensable position in the whole Chrysler world-wide scheme.
The Sub-Committee was right to point out that the continual boasting that it was hoped that eventually the Alpine would be made wholly of British components and from sources entirely in the United

Kingdom seemed on the face of it to conflict with the object of integration and did nothing to ensure that Chrysler United Kingdom became such a locked-in part of world-wide Chrysler that it could not possibly be ditched or neglected by the parent company, as happened in the past. I hope that the House will be enlightened tonight on those two matters.
I do not accept that the report endorses the rescue operation, but in the most useful way it shows points at which the Government may be helped to make the best of a very bad job.

9.15 p.m.

Mr. Ivor Clemitson: There is a sense in which the Chrysler rescue deal was a shotgun marriage. It was born out of crisis. In the words of the Select Committee, it was hardly the most glorious chapter in the Government's industrial strategy. It may well be true that Chrysler International got a pretty good deal. But those of us whose constituencies contain Chrysler plants or small firms which rely to some extent on Chrysler contracts—the Under-Secretary and I visited one in my constituency only last week—had to support the rescue, for the straightforward reason of employment.
It may be true, as the right hon. Member for Leeds, North-East (Sir K. Joseph) said, that rescues are enervating and debilitating. But unemployment is an enervating and debilitating alternative, and that is what would have been in store for many people in Chrysler and the other companies.

Sir K. Joseph: rose—

Mr. Clemitson: I will not give way, if the right hon. Gentleman will forgive me, because time is short. I realise that he would not accept that argument but would also talk about redeployment of labour. But if Chrysler had disappeared, there would have been one fewer car producer and it is debatable whether those remaining would have filled the gap. The chances are that the gap would have been filled largely by the foreign car makers, which have already captured 40 per cent. of our market.
Too much government is reactionary in the proper sense of the word: Governments of all complexions spend far too much time reacting to crises. That is the nub of some of the Select Committee's


criticisms. But we can react constructively only if we have certain structures. That is another point at which I would part company from the right hon. Member for Leeds, North-East. The market, whether it is the labour market or any other, is far from being perfect: it does not work.
It is far to early to make a definitive judgment on whether the rescue has been successful, but there have been some hopeful signs in the first year. We have seen a financial performance in percentage terms not that far off target. Chrysler has been the first in the field with a planning agreement. We on this side have been pressing the Department for long enough about the lack of planning agreements.
Here again I part company from the right hon. Gentleman. As I understand planning agreements, the idea is to have not a frozen, rigid plan but a rolling plan, which is constantly being reviewed. The trade unions should be involved to the maximum in this process, and I welcome the involvement which I understand they have already had in the formulation of the Chrysler planning agreement.
There appear to be hopeful signs on the employment front. There has been a vast improvement in the industrial relations record, as measured through days lost because of strikes. There are hopeful investment signs.
But I want to raise one or two questions. First, there is the problem of supplies, mentioned by the hon. Member for Bedfordshire, South (Mr. Madel). The commercial vehicle side of Chrysler, with which I am particularly concerned, was badly hit by the Rubery Owen dispute. That side has been hard hit over the years—although, to be honest, not in recent months—by the failure of Perkins to supply enough diesels. I should like my right hon. Friend to say something about the problem of supplies.
There is a need for longer-term planning and thinking. I gather that the company has made the point that as part of their side of the planning agreement the Government should provide more detailed and more frequent economic forecasts. What has my right hon. Friend to say about that?
There is also the problem of how we fit a planning agreement with one company with planning agreements with other companies in the same industry. How do we have planning for the industry as a whole? That raises an enormously complex issue.
Companies are becoming more integrated over national boundaries. As this is happening, particularly in the tie-up with other European countries, how do we ensure that we in this country gain as much as we lose, whether in quantity of work, skills, design work, or whatever? This is a significant matter in my constituency, where we have not only Chrysler but Vauxhall, with similar problems arising there.
The agreement was not the one which might have been worked out if there had been more time or more favourable economic circumstances, or if we had had certain structures by which the Government could deal with such problems. But a number of my constituents directly or indirectly depend upon Chrysler for a living, and their hope is that the company will not only prosper economically but that the start which has been made in planning for the future on some kind of joint basis will develop and grow.

9.24 p.m.

Mr. Hal Miller: I shall be brief, as I am sure that the hon. Member for Coventry, South-West (Mrs. Wise) wishes to speak before the Minister winds up the debate. In the time available I shall try to deal with two aspects which have been touched on already and to deal at greater length with the question of the Government's rôle.
My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) referred to the fact that the Secretary of State's disagreement with the Chrysler rescue was obvious at the time. He did not go on to speculate why. I wondered whether it had anything to do with the fact that Chrysler was a privately owned, American, multinational company.
There are some significant aspects to what I have just said. First, the Iranian contract would not have been continued unless the Chrysler Corporation itself in America had been willing to guarantee the performance of the contract. Secondly, there is the multinational


aspect. At least this evening the Secretary of State admitted that the success of Chrysler was wholly dependent on its integration into Chrysler Europe.
I have a great deal of sympathy with what the Liberal Party spokesman said about the lack of Government information or control with regard to the fortunes of Chrysler Europe which, in fact, has no independent existence as such. But the fact remains that the success of Chrysler in this country stands or falls with the success of the European operations as a whole.
It is not without significance that the Economist Intelligence Unit report refers specifically to the fact that that success would be largely based on the success of the French company which had provided most of the basis for possible advance. But the Government have not so far given any indication of the future viability of Chrysler Europe or of the possibility, which must have been examined, that sufficient funds will be forthcoming to produce the next generation of models, and whether these funds will be generated internally for Chrysler Europe to produce the plan. Both the Economist Intelligence Unit and the CPRS agreed that there is serious overcapacity in Europe and that by 1980 we must look forward to several further changes in the structure of the motor industry in Western Europe. Indeed, many of us would think that such a change in structure is about to take place in British Leyland.
The Sub-Committee's report and the Government's document on industrial strategy both mentioned planning agreements. We had a great deal of discussion about the nature of planning agreements, the possible benefits and disadvantages and the rÔle of Government when the Industry Act was being considered in Standing Committee. I have been in discussion with the company about the planning agreement which has been signed, as the White Paper tells us, by both the company and the Government. May we be told the significance of the fact that the agreement was signed by the Government? To what are the Government committed? The industrial strategy refers to commitment on both sides. Does that mean both sides of industry in that company, or does it mean the company and the Government?
It is the lack of confidence in the Government, to which I shall return, that has reached right down to the shop floor and made things so very difficult in British Leyland. The hon. Member for Luton, East (Mr. Clemitson) pointed out the difficulty of reconciling planning agreements between companies in the same sector. In its report the Sub-Committee pointed even more to the apparent difficulties should the company's plans not conform to those of the Government.
During the debates on the Industry Act I made it plain that I thought we should be providing the means for sectoral plans rather than individual industry plans. There was already the basis for this in the work of the little NEDCs. What was so unsatisfactory about the little NEDCs—the one on the motor industry reported long ago—was that even when the NEDC had been set up there was a Government and industry departmental working party. Governments of both complexions have significantly failed to do any of the things agreed to be necessary for industry in this country. Above all, they have failed to provide as stable an economic environment as possible.
I come to the third part of my remarks. What is the Government's input into this planning agreement? Have they been considering with the company the strategy for the motor industry as a whole in view of the over-capacity in Europe and the probability of structural change to which I have referred? Have the Government been discussing with the company the question of new mini models? Here I agree with my right hon. Friend. Is this a case of the Peter and Paul principle? Is the Chrysler Mini to be successful on the basis of Government money, merely at the expense of a possible failure of the Ford Fiesta, privately invested, or perhaps even the Leyland Mini, if that is to be produced, also financed by the taxpayer? What is the Government's view, and was it made available to the company?
I now come to consider what the company has been asking for from the Government in this planning agreement. This refers to the need to bring down interest rates and to have some stability of exchange rates. There must also be some stability of domestic demand and some reduction in taxation to provide the incentive which the Government have so far


failed to provide, particularly in British Leyland. Are we to take it that the Government are committed to providing some incentive for people by means of a reduction in taxation and by allowing differentials? As we understand it, those are the things that are provided for in this planning agreement.
Just what is the extent of the Government's commitment? What is meant by the Government signing this agreement? Those are the real questions that must underlie the success of any enterprise in this country. We are not concerned with just the motor industry in these actions of the Government, although it is significant that in this planning agreement it is the Chrysler company that is calling for things to be done, just as thousands of people in British Leyland have been calling for action, without being heard. We wish to know what response the Government will make.
The case for a planning agreement being needed is not proven. My right hon. Friend referred to leakages. Indeed, the Financial Times on Monday of last week was uncomfortably specific. I was informed by the company that it was suspected that the leak came not from the unions, I am happy to say, but from the Minister's Department. Perhaps the right hon. Gentleman would like to confirm how leaky his Department has proved to be.

9.33 p.m.

Mrs. Audrey Wise: The right hon. Member for Leeds, North-East (Sir K. Joseph) made it clear that his alternative to the Chrysler rescue and, indeed, to the British Leyland operation would have been to allow them to fold up, in the hope that in the course of time, and "as humanely as possible", as he said, both the labour and the resources would be redeployed There is a certain logic in the right hon. Gentleman's case. The only trouble with it is that in real life things do not work that way.
In real life, the market economy is not a system of perfect or even adequate competition. In real life, also, consumers cannot express their needs and requirements entirely through their individual operations as customers. There is a need to have a means for the community to

express a choice as to how resources should be deployed. I am not saying that in any spirit of posing the community against the individual, but rather as an expression of individuals joining together to express communal needs.
My constituents working at Chrysler will not be very impressed by the hope expressed by the right hon. Member for Leeds, North-East that their period of unemployment would have been relatively short. It is completely irrelevant to say that the average length of unemployment is six months. That is bad enough; but I shudder to think what the situation in Coventry would have been if British Leyland and Chrysler had been allowed to go to the wall, as the Opposition wished.

The Under-Secretary of State for Industry (Mr. Bob Cryer): And Alfred Herbert.

Mrs. Wise: Yes, and Alfred Herbert. The average length of unemployment in Coventry would have been far longer even than the year on which the calculations were based. Therefore, although what the right hon. Gentleman said was logical—he and his party opposed the Chrysler rescue—my constituents would not have been well served had the Opposition been successful in opposing it.
However, that does not mean that I regard rescues as being desirable in themselves. There I agree with the critics. To shudder from crisis to crisis and hastily pick up the pieces is not an adequate rôle for government to play; nor does it lead to satisfactory results. That is why we must find different structures in a different economy with different motive forces. It does not mean that the Government's actions in this case are to be condemned.
The Select Committee chose a particular line of criticism with which I completely disagree. Dealing with the question of confidentiality it said that there was too much leaking. It stated in paragraph 115 on page 57 of its report:
There was clearly understandable resentment among the work-force at the fact that while the Government and Chrysler had agreed to keep their discussions secret the progress of those discussions, and, more reprehensibly, the Government's own deliberations, received wide publicity.
I do not think that that was the cause of the apprehensions among the work


force. The work force objected not because there were leaks, but because nobody properly and officially consulted it. The Government negotiated with management. The Government were willing to speak to Back-Bench Members. The company was willing to speak to Members. It seemed to the work force throughout a large part of the proceedings that nobody was prepared to talk to it. Ultimately, the Secretary of State met the shop stewards and some discussions took place, but that was at a quite late stage.
The disgruntlement of the workers had nothing to do with any demand that the negotiations should be more secret but rather was the expression of a demand that the workers should be involved in the negotiations. That is quite different from what the Sub-Committee said. Here I support the workers' criticisms and not the Sub-Committee's criticisms. Government and negotiation by leak clearly are undesirable, inefficient and wrong in many ways, but the proper substitute is not more secrecy or tighter security but openness and proper consultation with all those involved. I think that ignoring the workers was a legitimate complaint that could be levelled at both the company and, at least in the early stages, at the Government.
The Sub-Committee asks that the criteria for rescue should be
Sound and precise, including the quantification of social factors.
I am not quite sure what the Sub-Committee wants. Judging from the statement on page 23 it seems to think that commercial factors are subject to precise quantification. I challenge that.
The report says:
The concept of 'social benefits' of assistance is one which is not capable of such precise definition as is the case with the commercial factors involved in an assessment of viability.
I do not believe that commercial factors are capable of precise quantification. I think that inspired—or uninspired—guesswork is a much more accurate description of commercial judgment. If the desire for quantification leads to an unwillingness to give full value to the importance of social factors, that would be a step backwards.
The Sub-Committee also says on page 24:
However, other costs (in the Chrysler case such things as the political importance of the Iranian contract, and the need to secure the acceptance of A New Approach to Industrial Strategy) will frequently be a matter of wider political judgment, and in such cases there will be the suspicion that short-term expediency has overruled commercial judgment.
I hope that in considering these matters the Government will not take the view of the Sub-Committee that commercial judgment is to be God in such a situation. Commercial judgment is just as subject to error and just as much influenced by short-term expediency as is political judgment. I deny that there is anything inherently better or more worthy in commercial judgment than in political judgment, or that it is more capable of being measured correctly. In that issue I am more on the Government's side than on that of the Sub-Committee.
I notice that the Government's response to the report includes a specific reference to transfer pricing. I welcome that. I welcome the fact that the Department of Industry has asked that particular attention be paid to this as part of the monitoring arrangements for the agreement. I wonder whether the Minister is satisfied that adequate methods of assessing the danger or occurrence of transfer pricing have been worked out. I wonder how close an eye the Department has kept on this matter, because there are genuine difficulties in assessing whether transfer pricing is taking place.
In the very nature of things there can be no true price discipline between two subsidiaries of the one organisation. They are not buyer and seller in the normal terms of the market, and the discipline to which they would otherwise be subjected does not exist. This is a very important issue. Can the Minister indicate how it is being tackled? It seems to be absolutely essential in considering the national interest.
I wish finally to refer to the subject of industrial relations. The Committee's report quotes a management spokesman as saying:
The change in attitude by our unions was a complete revelation. I cannot praise them too highly. They are playing an active vital rÔle in all the changes now going on. The result is that we are right on target with all our programmes.


The Committee's report added that it welcomed the change in attitude on the part of the work force,
which may in some quarters be the result of a genuine fear that Chrysler Corporation may still withdraw from the United Kingdom.
I regard the inclusion of that statement in the Report as, to say the least, a great pity. It appears to give credence and credibility to those who think that workers respond most of all to threats, particularly to threats of unemployment. There was no justification for including such a comment in the Sub-Committee's report.
The management's tribute to the work force, although gracious, takes a liberty in the sense in that it assumes that the need for a change in attitude lay on the side of the workers. My constituents certainly would say that the need for a change in attitude lay particularly with management. I am glad to see in the report and in the Government's reply a number of references to the increased amount of communication now taking place. I believe that good communications, and certainly the exchange of information, are necessary. But I hope that it will go much further and will mean real involvement in decision-making, and not simply the idea that workers should be passive recipients of information.
I am very critical of the Sub-Committee's report which is fair neither to the Government nor to the workers. Although I am also critical of the Government's reply, I must say that if these matters had been left to the Conservatives Coventry would now be a desert.

9.48 p.m.

The Minister of State, Department of Industry (Mr. Alan Williams): Although we have had a somewhat truncated debate this evening, I do not believe that our discussion has suffered because of brevity. Hon. Members have made many points in concise terms. My problem lies in seeking to reply to all those points in the limited time that remains to me between now and 10 o'clock. I can only tell the House that if there are any points of detail that remain to be dealt with I shall attempt to deal with them with hon. Members in correspondence.
The hon. Member for Tiverton (Mr. Maxwell-Hyslop) said that the Government should have known that Chrysler

was in danger. In a sense, that is at the heart of the communications between Government and industry. I shall come a little later to the point made by the right hon. Member for Leeds, North-East (Sir K. Joseph) about planning agreements. These considerations raise the question of how far the Government should be able to rely on the advice and information received from industry, particularly when the Government go to industry and pinpoint problems. In many cases they are given information which at a later stage is proved to have been complacent. Questions about this should properly be put not to the Government but to the company in terms of the rôle that it played at the time.
If we examine the record, we see that the Government made every effort to focus the company's mind on the problems as we saw them. The fact that we failed to do so may not be entirely the fault of the Government. Indeed, all this has focused attention on the need for planning agreements and the monitoring of the operation that is now under way. My hon. Friend the Member for Goole (Dr. Marshall) referred to this point in his speech. Indeed, the hon. Member for Colne Valley (Mr. Wainwright) said that he wanted to be sure that the Government would not be caught napping again. The Government want to be sure of that too, because it could be a rather expensive operation. In this sense, monitoring is a useful aid to the Government.
We monitor against performance criteria and not only with our own expertise. We also use outside consultants, and we have Coopers and Lybrand, an eminent firm, supporting us. We receive monthly statements, in absolute terms and in terms of variation of plans. The statements cover such categories as sales, production, exports, capital expenditure and finance. In addition there is a constant flow of management information and our departmental monitoring team has virtually daily contact with Chrysler management. Therefore, there is now a very different relationship in terms of communication between the Government and the firm The details must remain commercially confidential, but I am sure that hon. Members understand why this is so
My hon. Friend the Member for Coventry, South-West (Mrs Wise) referred


to the problem—which is recognised internationally as being difficult—of transfer pricing. Under clause 7 of the agreement with the firm there is a requirement that transfer pricing should be conducted on the accepted arm's-length basis, but I recognise the accounting difficulties of determining exactly what that is. The basis that is used must be disclosed to the Government, and the company must explain the way in which it arrives at pricing. For example, we have had an investigation carried out by Coopers and Lybrand into the way in which the components for the French Alpine cross the borders and the financial arrangements for that. On this analysis, we are satisfied that proper and acceptable accounting procedures are being applied. The aim of the monitoring, as of the planning agreement, is to avoid putting the company into a sort of straitjacket.
To some extent the right hon. Member for Leeds, North-East pin-pointed not only his own worry but that of industry about Government participation. There is an idea that the Government are asking industry to be locked into an unchangeable situation. That would be utterly unrealistic, and we recognise it as unrealistic in the monitoring and the planning agreement. Therefore, in our monitoring of the company's plan we accept that circumstances change and that, in the light of circumstances, modifications may be required, but we expect to have the case demonstrated and proved to us.
The right hon. Member for Leeds, North-East went out of his way to state his not surprising opposition to the whole concept of planning agreements. The hon. Member for Bromsgrove and Red-ditch (Mr. Miller) said that we should not go further than sectoral planning. This is a real quandry for Governments of either political complexion. Up to now both parties have, in various forms, indulged in national planning or national assessment of industrial and economic trends, and we have both gone through to the sector via the NEDC. We now have sectoral working parties, but our attempted planning and industrial guidance has foundered at sectoral level because decisions are not taken at that level. One can set a framework, but one must break from the sector to the key firm that can make a decision that can

lead to implementation—or partial implementation—of the recommendations of the sector working parties. That is the rÔle that we wish for the planning agreement. That is the next stage ahead.
I recognise that there are doctrinal differences between the two sides of the House on this matter, but I am trying to explain why we regard it as a logical extension of the attempts by various Governments to have greater communication between industry and Government. We are trying to get that communication through the sectors down to the decision-making points.
The right hon. Member for Leeds, North-East said that he was also against planning agreements because a firm which entered into an agreement was frozen into a particular situation. It is not our intention that agreements should be unchangeable. It would be irrational for us to make such a condition.
If Opposition Members consider the basis of the planning agreement, they will appreciate that, although it outlines parameters for 1980 and beyond, the detailed work is for this year, and it recognises that we have to roll the process forward in the light of experience and conditions at the time.

Sir K. Joseph: I trust the Minister will make sure that he answers the questions about leaks and the trade union attitude to planning agreements.

Mr. Williams: Time is short, and I was going to make those points. To my knowledge, there has been no leak from the Department. If there were, the Secretary of State and I would strongly disapprove, because we place a high value on confidentiality.
I know that the right hon. Member for Leeds, North-East has only just moved to his job as Opposition spokesman on industry, but if he looks at the original White Paper dealing with planning agreements he will find that trade unions were not to be parties to agreements. The provisions dealing with the passing on of information were designed to improve communications and ensure a consensus of approach for the future within industries.
The right hon. Member made some rather strange statements. He suggested that companies should be allowed to put


their own houses in order and he implied that it did not matter if they failed to do that and, therefore, collapsed, because resources would then be gainfully employed elsewhere. That is an interesting philosophy, but it differs from the philosophy followed by the Cabinet of which he was a member when it saved Rolls-Royce and Govan Shipbuilders. The right hon. Gentleman may dissociate himself from those decisions now, but he was a member of the Cabinet which took them and they are decisions of the same type as that taken on Chrysler.
The right hon. Gentleman said that a torrent of people are changing jobs every month. He is correct, but many people change their jobs because they want to do so, and that is rather different from having to change a job or having no job at all. Many people change jobs because they have been employed in seasonal occupations or in temporary jobs in, for instance, the building industry. There are many reasons for people changing their jobs, but they are all quite different from cutting off job opportunities in a wide area which is implied in the type of operation in which the right hon. Gentleman would indulge.
Clearly, the Opposition would have allowed Chrysler to collapse, and if they were in power and the situation occurred today they would still allow the company and all the firms that supplied it to collapse. They would be willing to accept all the difficulties and repercussions that would result in the Midlands. I suggest that the people of the Midlands should ask themselves how they would fare if the right hon. Member for Leeds, North-East were administering industrial policy now.

Question put and agreed to.

Resolved,
That this House takes note of the Eighth Report from the Expenditure Committee Session 1975–76 (House of Commons Paper No. 596) on Public Expenditure on Chrysler UK Limited, and of the relevant Government observations (Command Paper No. 6745).

BUSINESS OF THE HOUSE

Ordered,
That the Representation of the People Bill may be proceeded with at this day's Sitting, though opposed, until any hour.—[Mr. Ashton.]

Orders of the Day — REPRESENTATION OF THE PEOPLE BILL

Order for Second Reading read.

10 p.m.

The Minister of State, Home Office (Mr. Brynmor John): I beg to move, That the Bill be now read a Second time.
As hon. Members will know—although Ministers are supposed to forget about it—county council elections in England and Wales are due to be held on Thursday 5th May. Elections to the Greater London Council are to take place on the same day. District council elections in Scotland are to take place on 3rd May and in Northern Ireland on 18th May.
The limits on expenditure by candidates at local elections in Great Britain are laid down by Section 64 (2) of the Representation of the People Act 1949, as amended. The reason for having such limits on candidates' expenses is primarily to ensure that all candidates and all parties can fight on equal terms and without undue expense. The limits for local elections have been raised twice since 1949 to take account of the fall in the value of money. For example, they were raised by the Representation of the People Act 1969 and, except for the limits for elections to the Greater London Council, by the Representation of the People (No. 2) Act 1974.
The Government have received many representations from many quarters that the limits have been overtaken by inflation and that unless they are raised they will present serious difficulties to candidates at the forthcoming local government elections. We therefore consulted the main political parties and the local authority associations on the basis of a proposal to raise the existing limits to take account of the decline in the value of money since April 1974, when the Representation of the People (No. 2) Act 1974 received Royal Assent. That is the basis of the Bill.
The GLC election expenses limits have not been raised since the Representation of the People Act 1969. That was because when they were considered in 1974 they were thought to be adequate and did not


need to be adjusted. We have therefore considered that it is right to raise the expenses limits for the GLC elections on the same basis as for the other authorities to compensate for the decline in money values since 1974.
There is almost unanimous agreement for the Government's proposals. That does not mean that the present arrangements are necessarily ideal. There are other ways in which calculations can be made. The present basis, however, was considered by the Speaker's Conference in 1965, and that conference made no recommendation that altered the principle—namely, that there should be a lump sum to take account of expenses that did not vary with the size of the electoral area while adding a variable amount which increased the limit according to the size of the electorate.
Although we recognise that there may be some other differences of principle, we believe that it is right in general terms to set up a new Speaker's Conference to consider that, amongst other things. The Bill is an emergency action to ease the situation that will occur in May unless action is taken.
I now turn to the provisions of the Bill. They lend themselves to a brief summary. The limit on a GLC candidate is £200 plus 5p for every four entries on the register. That is to be raised to £320 as the lump sum with an additional 2p for every entry on the register. That is 60 per cent. increase. The new figure has the incidental effect of making it slightly easier to calculate the maximum lump sum that may be spent.
Clause 1(1) of the Bill raises the limit at any other local government election in Great Britain. It raises to £72 the standard amount in each area, together with 1½p for every entry on the register. This is slightly less than the 60 per cent. laid down for the GLC elections. It has the advantage of simplifying the formula and only slightly reduces the amount which would be 1·6p per elector. These latter limits apply to county and district elections in England and Wales, community council elections in Wales, and parish council elections in England. The limit also applies in the regional, island area and district council elections in Scotland.
I have not so far referred to the limit on candidates' election expenses in the

City of London. It has been customary to keep these in line with limits applying elsewhere, and that is done by Clause 1(2).
Clause 1(3) deals with candidates' expenses in Northern Ireland elections. Its effect is to bring them into line with those for local elections generally in Great Britain. Hitherto the limits on candidates' expenses have been set under Northern Ireland legislation, but in practice they have never exceeded the limits laid down for Great Britain. Provision has been made in the Northern Ireland (Local Elections) Order 1977 to raise the limits in Northern Ireland to those laid down under existing legislation for Great Britain.
Since the Order in Council which contained this provision also contained a number of other vital matters for the 18th May elections, it was not possible to hold back the legislation on expenses or to anticipate what will be done in the Bill. To ensure that the limits in Northern Ireland remain in line with those in the rest of the United Kingdom, we have had to resort to the unusual practice of revoking Article 7.1 of the 1977 order. In the circumstances of this particular case, however, I am sure that the House will readily agree that that is the right thing to do, and it will ensure that there is equality and justice for the conduct of the elections in Northern Ireland on 18th May.
In short, therefore, the Bill is presented with a wide degree of all-party support here. Its basic reason is the urgent necessity to make sure that the election campaigns are adequately financed, and that is why I hope that the House will give the Bill a speedy Second Reading.

10.7 p.m.

Mr. Roger Sims: The Opposition are happy to support this modest Bill. We agree, of course, that with the increased cost of paper, envelopes, postage, printing, and the hiring of rooms and halls, the existing limits are clearly unrealistic. It is right that there should be limits, but it is difficult to run a proper election campaign on a very tight budget, and these increases will afford flexibility both to candidates and agents.
The Minister of State knows that my party would have preferred that the


figures should take account of the difficulties of small wards. After all, the costs per elector are much more in a ward of, say, 500 electors than of 5,000, particularly when it comes to printing costs. We accept the proposal as reasonable, however, and we think that the increases are about right.
Let me draw attention to one point. It is a pity that, whilst taking account of inflation as it affects Section 64, the Minister has not taken the opportunity to amend similarly Section 61(2), which reads:
Every payment made by an election agent in respect of any election expenses shall, except where less than forty shillings, be vouched for by a bill stating the particulars and by a receipt.
The Bill takes account of inflationary movements since 1969. That figure of 40s. originally appeared in the 1949 Act. Bearing in mind that receipts are now relatively rarely given, and certainly not for particularly small amounts, and bearing in mind the amount of paper work involved in accounting for quite trifling sums, I wonder whether the opportunity might be taken to amend this section.
I would have thought that if £2 was an appropriate figure in 1969, a substantially higher figure would be needed now. No doubt the Minister's right hon. and hon. Friends in the Treasury can advise a revised figure. I would have thought a minimum of £5, but perhaps £10 or £15 would have brought the section into line.
The Opposition have no wish whatsoever to delay the Bill. We are anxious to expedite it so that it can complete its passage and receive the Royal Assent before the May elections, as the Minister indicated. But between now and Committee stage will the Minister look into the possibility of adding a further brief clause effecting the modest amendment that I have advocated? I should be very willing to put down my own new clause by Committee stage, but I suspect that the drafting of the Minister's Department would be a little more accurate than mine.
I refer to one other apparent anomaly in the law which particularly concerns local government elections but not parliamentary elections. It is quite obvious

that in wards and districts represented by two or three councillors an agent may represent two or three candidates. The election addresses and other literature may relate to all three and meetings are held to promote the cause of all three, and at the end of the day there is one lot of election expenses whether there is one candidate or three. But the agent finds that he cannot submit composite returns of election expenses. He has to split every election expense into three, obtain three separate receipts for every cost incurred, and so on.
If one return covering all the candidates for whom the agent acts were acceptable, I cannot think that that would upset any principle on which electoral law is based, but it would certainly make life easier for election agents, a body of men and women on whom we rely strongly and for whom we all have a special respect. I have no wish to press the point at this stage, but I hope that it will be considered.
I also hope that we may very soon have a Speaker's Conference. If I interpret the Minister's remarks aright, I think that that appears to be the case. I hope that the conference will consider the expenses of candidates at parliamentary elections. There are several features that need to be looked into, not least that a candidate's personal expenses have to count towards the maximum allowable figure. I wish the Bill well and ask my hon. Friends to support it.

10.12 p.m.

Mr. George Thompson: In former times I would not have considered it appropriate to make a contribution to the debate, but I have found in the past two years that if one is present and does not say anything it will be assumed that one is not here.
I am well aware of the sanctimonious humbug from Scottish Members from other parties who hold up their hands in horror if there is no Scottish National Party Member here. Now it is my turn to say that none of them is here either. [Interruption.] I apologise, Mr. Deputy Speaker. I have always regarded you as being removed from the hurly-burly of political battle and the expressions indulged in by other hon. Members.
My party welcomes this modest increase in expenses. It is obviously


necessary to limit expenses in elections, because some parties draw their funds from trade unions, others could draw apparently unlimited expenses from big business and from the wealthy, and others draw their expenses from the widow's mite and other modest contributions from our supporters.

Mr. Bruce George: Into which category does the hon. Member come?

Mr. Thompson: The widow's mite. [An HON. MEMBER: "What about Sir Hugh Fraser?"] There is only one real widow amongst them all, compared with the millionaires to be found in much larger numbers on the other sides.
It is necessary to provide for election expenses, otherwise candidates would not

be able to give their message to the electorate. It is equally necessary to take account of inflation and increases in the cost of paper. That is a good reason why there ought to be more planting of trees in this country, to provide more paper much less expensively.
It is very pleasant to have a short Bill to consider at this time of night, so I shall keep my remarks short and to the point. I welcome the Bill and commend it to the House.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the whole House.—[Mr. Ashton.]

Committee tomorrow.

Orders of the Day — LOW-INCOME FAMILIES (FUEL COSTS)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Ashton.]

10.15 p.m.

Mr. George Rodgers: For some time I have been anxious to focus attention on the impact of high fuel costs on low-income families. In recent weeks many householders of very modest means in my constituency, particularly in the Astley Park area, have received quarterly electricity bills of well over £100. I find this quite frightening. We are advised that the price of gas is to increase by a further 10 per cent. This is a totally unnecessary surcharge—it is certainly unnecessary commercially—which is being imposed at the dictates of the Treasury and the International Monetary Fund.
The upward surge in the cost of light and heating has brought distress and misery to many families. Indeed, it was only when I commenced to gather material for this debate that I began to realise the extent of the calamity.
It has long been my plea that in a civilised society there are a small number of basic entitlements that are the right of every person—sufficient to eat; adequate shelter and clothing; medical attention at time of sickness; and a reasonable degree of warmth and light. I do not even advocate that these facilities should be provided without the recipients making a proper payment wherever that is possible. However, I am adamant that no one should be deprived of these necessities because of poverty or misfortune. Nor should the price of any one of these items be so high that it denies someone the opportunity of purchasing the other essentials to which I have referred.
The price of fuel is now so high that many families have to make savings and sacrifices in food and clothing to meet its cost. I contend that this situation cannot continue. It is high time that bold steps were taken to remedy the situation.
I recognise that the Government have

introduced various measures to ease the difficulties facing the poorer section of the community. The simple truth is that these measures are totally inadequate in face of the massive increases that have taken place in the price of coal, gas and electricity. Many families are overwhelmed by the enormity of the additional costs that have come about at a time when wages and salaries are severely restricted and when prices that they pay for other essential commodities have also dramatically increased.
There are substantial gaps in the new code of practice adopted by the gas and electricity industries to prevent the disconnection of fuel supplies in the case of hardship. The code is the Government's response to recommendations from the Department of Energy and the National Consumer Council that the industries' powers to disconnect should be curtailed and that domestic debts for gas and electricity should be collected through the courts.
The major provision of the code is that there will be no disconnection in cases where a consumer pays regular instalments large enough to save for the next bill and to pay off the previous one within a reasonable period. This period will be the period before the next bill arrives, leaving about 10 weeks to save up for two bills. A rule-of-thumb method to calculate the size of the weekly payments is to multiply the current bill by two and divide by 10. If a bill for £42 has just arrived and cannot be paid, the weekly payment to avoid disconnection will have to be about £8·40 a week. Most poor families living at or just above the supplementary benefit level will find such savings impossible.
The code also provides that disconnection will be delayed for at least 14 days where the consumer applies to the social services department or the local social security office for help. A consumer will be recommended to apply to these offices for help if the family receives supplementary benefit or family income supplement, if the breadwinner is unemployed, or if there are children aged under 5. But there will be many families in these categories whom neither the social services nor social security can help. The social security office can help only if the family


receives or could receive supplementary benefit. The social services department can help with money only where there are children who may otherwise have to be taken into care. Social services departments have limited amounts of money for such help and many have already run out. After the 14-day delay many families with children will still be disconnected.
Another paragraph of the code prohibits disconnection of pensioner households during the winter but during the rest of the year pensioner households may be disconnected. If they cannot afford the weekly instalments and the bill remains unpaid, they may not be reconnected during the next winter.
Finally, tenants will continue to be disconnected if the landlord supplies them with electricity through coin boxes and his own supply is cut off for non-payment. These gaps in the code reflect a belief within the industries and within the Government that help from the Welfare State must be possible in all cases of genuine need. The code is designed to delay disconnection until that help is found. But for many families power is simply too dear for the poor to afford. Many families will be without a supply again this winter.
Less than three weeks ago an employee of the Family Service Unit was able to collect, within a few hours, information about no fewer than 25 cases in which the liaison procedure had broken down one way or another. Nearly always the problem revolves round the system of preventing fuel disconnections taking place by the voluntary deduction scheme. Unfortunately, poor families are suffering deprivation in other areas because such a large proportion of their income is used to meet fuel bills. The standard of living of these families is inevitably reduced to an unacceptable level.
Perhaps I may illustrate this important point by giving a few examples from different parts of the country. In Manchester, an unsupported mother with five children has £23 per week on which to live, after deductions. Again, in Manchester there is a family with three children, all under 5 years of age, and their gas and electricity supplies have just been restored. After deductions, that family has £12 per week on which to live.
In Leicester, a single-parent family has £12·45 on which to survive, after deductions, and there are four children in the household. Yet another single-parent family in the same town, with three children, all under the age of 3, is left with £11 per week after deductions for rent and £8 for electricity payments. There are also many examples that demonstrate that the 50p-per-week-off-arrears rule is not being adhered to.
There are many instances in which deductions for future bills are obviously too high, taking into consideration the appliances being used. An old-age pensioner in Newcastle has £3·50 a weak, for electricity, deducted from his supplementary pension, and he has only electric light and a television set. It is particularly worrying when it is obvious that the amount being deducted is too high, yet it is almost impossible to have it reduced.
This fact is well illustrated by the case of Mr. Smith, from Newcastle, He has an 18-month-old daughter and an invalid wife. He has £4 per week deducted towards his gas bills, and it was proposed that this should be increased to £5 per week. Because he had made his own calculations, he knew that this was too much, but he could not convince the gas board or the DHSS. When he told the local office that he refused to have £5 per week deducted, the office immediately informed the gas board, which sent a disconnection notice. On the appointed disconnection date, the local Right to Fuel Group formed a picket outside Mr. Smith's house with the intention of refusing entry to the gas board official. The result was that Mr. Smith was not disconnected and proper consideration was given to the amount deducted from his weekly benefit. Instead of being raised the deduction was reduced, from £4 per week to £3·50.
One of the reasons behind the introduction of the liaison procedure was to prevent people who received supplementary benefit having their fuel supply disconnected. People can still be threatened with that, despite having weekly deductions made from their benefit.
There is an example of an unsupported mother with six children in Birmingham—the youngest child is 18 months old. Mrs. Jones was having voluntary deductions made towards her gas and electricity bills. When the bills, for £12·50 and £25, respectively, arrived in mid-November,


she knew that she had sufficient savings with the DHSS to pay both immediately. She took the bills to her local office at once, but four weeks later she received a disconnection notice from both gas and electricity board. She telephoned the DHSS several times, but got no satisfaction. In desperation, she approached a social worker who had to make 13 telephone calls to the local DHSS office before payment was made. Payment was sent to the boards more than six weeks after the bills were received.
I accept absolutely that some families run into trouble because the head of the household is a poor manager and is unable to cope with the grim circumstances that I have mentioned, but there are few people who could easily cope with the problems that afflict a single-parent family with three, four or five young children. The strain must become almost unbearable. The family deserves and requires understanding and support rather than criticism and condemnation. In any case, what sort of society is it that would abandon people because they prove inadequate in the face of grinding poverty and constant adversity?
On 25th February the Supplementary Benefits Commission produced a far-reaching report on "Heating Costs for Pensioners". It contained the encouraging news that, whereas in December 1971 200,000 heating additions were being paid to supplementary pensioners, the figure has now risen to over 1 million, despite a considerable drop in the total number of supplementary pensioners. None the less, it was disturbing to read in the survey that there may be a further 250,000 supplementary pensioners who qualify for the extra heating additions but are not receiving them.
In my view a vigorous campaign should be undertaken to advise these pensioners of their entitlement, even if it means the recruitment of additional staff. Most sensible people would concede that these new employees would be usefully and gainfully employed.
Of equal importance are the needs of the elderly who do not qualify for supplementary benefit. Indeed, only 23 per cent. of those over pensionable age are drawing supplementary allowances, and nothing can be done by the Supplementary Benefits Commission to help the

remaining 77 per cent., many of whom are very little better off than those receiving supplementary pensions. Thousands of disabled people with special heating needs do not receive supplementary benefit.
I turn now to the electricity discount scheme, which will enable householders who receive family income supplement or supplementary benefit to claim a rebate of 25 per cent. from the charge for electricity used in one winter period. Clearly, any programme designed to help those at the lower end of the income scale warrants applause, and I pay tribute to those responsible for this enterprise.
Even so, I must say that the project has many curious and contradictory aspects. Many millions on low incomes cannot possibly benefit from the provision. A great many pensioners and a great number of those unemployed will receive no help whatever from the scheme. The concession, of course, does not apply to charges for gas supplies. Should anyone on supplementary benefit or family income supplement have a coin meter that the landlord empties he will not be eligible for the 25 per cent. discount, despite the fact that he almost certainly pays more for his electricity than most, and certainly those who are sub-tenants or who are in possession of mobile homes are not eligible.
People will not qualify, either, if they pay a landlord or housing association directly for the flow of electricity. Nor will they receive the discount if they pay for central heating with their rent.
When I investigated the sensationally high electricity bills presented to my constituents living in a new housing development near Chorley, I was shocked to find that housing construction is still allowed to proceed with only one source of fuel provided, even when it would be simple and straightforward to install both gas and electricity. It makes one wonder whether we are really concerned about the efficient utilisation of energy.
There is much that can be done to conserve our supply of power and at the same time assist those who can no longer absorb and accommodate the ever-soaring cost of fuel. I suggest an immediate six-point plan to arrest a deteriorating situation.
First, there should be a fair pricing system for domestic consumers and an


end to the very advantageous terms for the supply of fuel that have been made available to many sectors of industry.
Secondly, there should be realistic heating allowances for pensioners and the disabled, and assistance for all low income groups, including the unemployed.
Thirdly, there should be a nation-wide programme of home insulation to prevent the casual loss of heat that is at present, tolerated. An enterprise of this nature would pay for itself in a comparatively short time and could provide useful employment for many who are without work.
Fourthly, we should give urgent priority to the development of the slot meter that will accept plastic tokens, which it subsequently sheds. This would provide a popular system of making payments and would discourage meter thefts.
Fifthly, there should be a ready How of comprehensible information about people's rights and entitlements under a code of practice or through the DHSS.
Sixthly, the present method of disconnection without reference to the courts should be discontinued.
I offer my sincere thanks and appreciation to the members of the Right To Fuel Campaign and the National Council for One-Parent Families who have worked hard to keep all hon. Members well informed on this subject. I am grateful for their deep concern for justice and reform in this field.

10.30 p.m.

Mr. Eddie Loyden: I thank my hon. Friend the Member for Chorley (Mr. Rodgers) for allowing this brief intervention and congratulate him on the constructive way in which he has presented the case. I want to reinforce his arguments.
I have been much involved in this problem, having brought in a Ten-Minute Bill to remove the powers of the electricity authorities to disconnect. It went the way of so many Ten-Minute Bills, but it gained the attention of Ministers and the organisations to which my hon. Friend referred.
My hon. Friend mentioned the gaps in the present schemes. There is also inadequate social service provision to help people to meet their urgent needs when disconnection occurs. In my con-

stituency interviews recently, I heard of a woman with four children who was offered the use of candles in place of electricity in those circumstances. This was not long after a tragedy not far from this place, in which the use of candles led to young children being burned to death. I cannot lay the blame at the door of social service departments; it is simply that their resources are inadequate.
The six points that my hon. Friend made form a constructive plan to overcome many of these problems. The proposed increased charges for gas will mean that the next round of bills, certainly in the winter, will create a serious problem for the elderly, the single-parent families and the 1½ million unemployed. Therefore, my hon. Friend's points must be taken seriously by the Minister. If next winter is severe, bills that have doubled so quickly will be even higher, and these problems will be even more serious than they are now.

10.33 p.m.

The Under-Secretary of State for Health and Social Security (Mr. Eric Deakins): I very much welcome this debate on a subject that is of great concern to the Government, as it is to all hon. Members. Although I am replying to my hon. Friend the Member for Chorley (Mr. Rodgers), this problem goes well beyond the concerns of my Department, into energy policy and pricing, housing and housing standards for insulation, and, inevitably, public expenditure. I shall draw the attention of my hon. Friends in the Departments of Energy and the Environment to the specific points that are of concern to them.
Our concern is, essentially, twofold. First, we want to ensure that people, particularly old people, who make up a large part of the poorer section of the community, are warm enough. Secondly, we want to enable poorer people to pay for the heating they need.
The Government fully understand the concern felt about steep increases in fuel prices since 1973, but there is no easy escape from the effects of pay settlements in the coal and power industries and big rises in the price of oil. The country could not protect itself from the dramatic increase in the price of oil demanded by the oil-producing countries. More recently the Government took a decision to phase out subsidies in order to end a situation


in which prices bore no relation to costs of supply and production and which had led to serious market difficulties. That is why there have been price increases in the domestic sector since March 1974 averaging 50 per cent. for gas, nearly 70 per cent. for paraffin and heating oil, 100 per cent. for coal and coke, and 125 per cent. for electricity.
However, these increases need to be kept in proper perspective, because when one looks at the position over a longer period one finds that there is a different story. From 1970, fuel prices overall have risen in real terms by only 9 per cent., although I recognise that it is the size of the actual increases, concentrated in a very short period, that has created so much difficulty.
Reluctantly, I have to say that further increases are coming up for 1st April. Gas prices will go up by an average of 10 per cent. Coal prices also will be going up at the same time—15 per cent. on coal and smokeless fuels—though rebates available up to 30th September will substantially moderate these increases. On electricity, the Government have before them proposals from the area boards for new tariffs to take effect in April.
Everyone has felt the impact, each quarter. But the increased cost of fuel presents many people with a choice—what to give up to pay for it? Can they use a little less fuel? Should they invest in some form of insulation, or a heating system that is cheaper to run? The fact that they have such a choice also gives them a breathing space. For people on low incomes the same choice hardly exists, or if it exists it is only in a crueller form, as a choice between necessities—between fuel and food. Even the comparatively modest outlay on loft insulation may be beyond their reach. Certainly, a different form of heating is, even if this were possible. But in many cases it is not. These people live in rented accommodation, or cannot change from an all-electric system.
Nor is it just a question of finding the money for fuel. It is also a question of the method of payment. It is in many ways an unfortunate piece of timing that these price increases have followed a general switch from pre-payment, coin-in-the-slot meters to credit meters, where the bill comes in once a quarter. Of

course, credit meters have great advantages. They are more secure from burglars. They are, for example, more easily read. They can be sited outside the door of the flat. They do not fill up. There is no problem about running out of shillings. But they demand a certain skill in budgeting over a considerable period—a skill that may not be possessed by some consumers.
I hope that this necessarily brief account will indicate the Government's clear recognition of the problems—problems that have to some extent been moderated by a succession of fairly kind winters. We seem to have had another one this year, and have eyed the eastern United States with some apprehension, but greater relief.

Mr. Dan Jones: Not up in the North.

Mr. Deakins: I take the point. I cannot help feeling that we are overdue for a really harsh winter.
What, then, have we done to alleviate these problems? Principally, we have increased social security benefits. Compared with the rates in October 1973, when the previous Government last increased them, the rates in force since November 1976 are 96 per cent. higher. Since October 1973 prices have risen by about 78 per cent. So the purchasing power of pensions is about 10 per cent. higher than it was then.
The prices index includes the increase in fuel costs, and it is worth noting that the index for pensioner households has closely mirrored the general index. Since the Government took office there has also been a dramatic increase in the number and level of heating additions to supplementary benefit. The number of these additions has more than doubled in three years, so that now over 1 million claimants get them. The rates have gone up by 133 per cent. since 1973. We know that—as the Chairman of the Supplementary Benefits Commission made clear recently—there may still be some people who are not getting an addition but who in fact meet the criteria. But the numbers getting additions are rising steadily, and we are doing our best to ensure that additions go to all those who are entitled to them.
We have put out a poster for display in post offices and doctors' surgeries


setting out the criteria briefly and inviting claims from those who think they may be entitled. We are also asking local office staff to bear the possibility of heating additions particularly in mind when they work at cases. We are considering what other administrative measures might be taken to improve take-up, and will not hesitate to take any practical steps to improve the take-up of these additions even further. There are also other steps that the Supplementary Benefits Commission takes. It can make exceptional needs payments to help with fuel bills in certain circumstances—for example, where a claimant has moved to a home with a new heating system and has not yet learnt how to manage it economically, or budget for the bill, or where there has been a period of unusually severe weather. There were about 48,000 such payments in 1975, averaging £22·70.
In many cases, though, there are not the sort of exceptional circumstances that would justify a lump sum payment. The commission and the fuel authorities therefore negotiated arrangements, which came into force last February, designed to avert disconnection where this would cause hardship—broadly, cases where there are young children, sick or elderly people in the household. An amount equal to estimated weekly consumption plus 50p towards the arrears is deducted from the claimant's benefit each week and paid over to the fuel board. If after two years there are still arrears outstanding, the commission will consider clearing these by a lump sum. These arrangements are not the perfect answer. There are cases in which the amount of supplementary benefit paid on top of other income is insufficient to cover current consumption. There are cases in which fuel consumption is very high, and deductions have to be correspondingly high if the debt is not to get bigger.
There are failures of liaison between social security offices and fuel boards, inevitable with large organisations under heavy pressure. Criticism of the scheme along these lines tend to highlight a small proportion of extreme cases. To put the thing in perspective, I remind the House that in the first three months of these arrangements over 14,500 claimants were put on to this system of direct payment. In the same period roughly the

same number of exceptional needs payments for fuel were also made.
My hon. Friend cited a particular case in which there is a high level of deduction. He suggested that the direct payment arrangements are causing hardship. But what if there were no direct payment arrangements? Either the claimant he mentions would be saving for herself the same amount from her benefit each week—very likely more—as the fuel boards, with no prospect of settlement of the balance after two years, would perhaps seek a faster rate of reduction of the arrears than 50p a week, or her electricity supply would be disconnected. Let us not forget that this is exactly the choice facing those in full-time work.
There is a third possibility, of course, that the Supplementary Benefits Commission should simply pay the bills of all their claimants who get into difficulties. But in exercising their discretion, the commission must have regard to the limitations put into the Act by Parliament and restrict such payments to cases in which the circumstances are exceptional. I have already indicated the sort of criteria that the commission considers, and these are set out in more detail in publications such as the Supplementary Benefits Handbook. I would add that a policy of simply settling the bills of those who get into difficulties would discriminate unfairly against those claimants—the great majority—who do manage on their incomes. It would also encourage them not to manage. And it would be widely resented by those not on supplementary benefit, whether in work or not, to whom such assistance was not available.
There are no easy answers to this problem, especially where the claimant's fuel consumption is high. To suggest that the direct payment arrangements are causing hardship is not a fair response. Our experience has been that these arrangements have proved of great value to a very large number of claimants in averting disconnection. The commission also uses its power to make lump sum payments for such things a simple draught-proofing, curtains and floor coverings.
My hon. Friend also mentioned the code of practice on disconnections and


fuel payment procedures. This document was produced by the gas and electricity industries, and I trust that my hon. Friend will not expect me to answer for these industries on how they interpret it in detail. But I should perhaps explain one thing. Under the direct payment arrangements for supplementary beneficiaries, the normal amount deducted each week towards the arrears is 50p—it may be more, but only where the claimant has larger resources or actually asks for it to be more. Those not on supplementary benefit, or to whom direct payment cannot apply, have to make their own arrangements with the fuel boards for paying off the arrears. In these cases it is up to the boards to fix a rate that will recover the debt in a reasonable period, consistent not only with the spirit of the code but with their commercial objectives. The Government regard this code as a measure to help people avoid debt and prevent really needy people from being disconnected for non-payment of fuel bills. As the code makes clear, however, a continuous assessment of its working will be made and the Government will be watching closely to see what its impact has been this winter.
Moving away from strictly social security provisions, we have taken another important step. In December my right hon. Friend the Secretary of State for Energy announced the details of a scheme costing up to £25 million to pay a 25

per cent. discount to recipients of supplementary benefit and family income supplement on one of their winter electricity bills. The Government recognise that this scheme has been criticised and has elements of rough justice about it, but it is providing a useful measure of help to a large number of people among those who find the greatest difficulty in paying their fuel bills.
As to the methods of payment, a wide range is now offered by the industries. Both gas and electricity have budget payment schemes, so that credit customers can pay by monthly instalments. In most areas and regions stamps can be purchased from showrooms and used towards payments of bills. In some cases weekly and monthly payments are accepted. The industries are working as rapidly as possible to make all their schemes available in all areas. The industries have also agreed that in appropriate cases they will provide a pre-payment meter, provided it is safe and practical. Perhaps I could add here two points. First, it is in the field of methods of payment—

The Question having been proposed after Ten o'clock, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, puant to the Standing Order.

Adjourned at fifteen minutes to Eleven o'clock.